Does No MOT Invalidate insurance?

[Dm47]

My father had a car accident last year – his fault.  He hit a motor cyclist, the motor cycle was a mess so I am guessing the motor cyclist claimed for a new motor cycle and for his injuries.  Additionally the cost to repair my fathers car was £3k which his insurance paid.

However at the time of the accident my fathers car MOT had expired by 3 weeks. 

He genuinely forgot as he is nearing his mid 70s he gets more forgetful. 

I am lead to believe that this means his insurance is not valid and therefore in theory he has to pay for his costs and the motor cyclist costs. 

My mother spoke to the insurance company today (as my father is not capable anymore due to health issues) and after scaring her that she could be liable up to £80K in costs due to this mistake, they agreed that within 21 days she pays the cost to repair their own car which was £3k and everything will be settled.

Anyone have any advise on what my parents should do please.  

[unclebulgaria67]

Lack of MOT, just means damage to own car is not covered. Which is why it is reasonable to repay the 3K it cost to repair the car

Under Road Traffic Act law Insurance company still liable for damage to third party property and injuries. And the lack of MOT  does not provide grounds to ask your father to cover these additional claim amounts. The MOT is a legal requirement, but does not mean the car was not roadworthy. And the lack of MOT does not appear relevant to the cause of the accident.

[Ethel Street]

@Dm47

 

Why on earth did your mother call the insurers when they hadn't raised the issue! Unsurprisingly their call centre took advantage to try and get out of paying the claim.

Who is the insurer please.

I assume your father's car was roadworthy before the accident, and that there is no suggestion that the vehicle's condition contributed to the accident. In which case the only way having no MOT is relevant is if there is a specific clause in his policy that expressly states that having an up to date MOT is a condition of the policy. Some policies do say that, most I've seen don't.  Have you read the policy? What does it say? You need to study the policy wording to see if MOT is mentioned before deciding what to do next.

Anyone can check the MOT history of any vehicle on gov.uk [ Check the MOT history of a vehicle - GOV.UK (www.gov.uk) ] free of charge, so insurers could certainly have done so if they thought it was relevant.

Is the position that they have paid your father's claim for the damage to his car, about £3k, and they are now asking him to repay it? 

Unfortunately what's been said can't be unsaid so this going to have to be dealt with. The insurer should now put that demand in writing and when they do can you post the letter here as a single pdf with all identifying information and reference numbers covered up to keep it anonymous. How to Upload Documents / Images as PDF on CAG - Guides and advice on using the forum - Consumer Action Group

Let's see what they say is the reason the lack of MoT makes the claim invalid. If they don't explain ask for an explanation. It is open to your father, despite your mother's conversation, to say that having read their reasons he does not accept the claim is not covered and will not be reimbursing the claim already paid. 

I assume he has an MOT now?

 

 

[unclebulgaria67]

My presumption is that the Insurance company wrote the policyholder asking to be contacted

And they were aware the MOT had run out.

And the Insurers asked for the 3k based on the policy requiring vehicles to meet all legal standards required.

But as Ethel says, you could ask for proof  before paying the money to them.

[Ethel Street]

I didn't read that into Post #1 but hopefully OP will clarify.

I would expect insurers to routinely check all the documentation they considered relevant, eg MOT, before paying a penny of own damage but, unless I misunderstood the OP they have paid and are now asking for reimbursement. If that is what has happened there's an interesting legal debate for lawyers on whether the insurance company is allowed to recover the their claim payment even if the policy does require an MOT to be in force considering that the insurer knew, or could reasonably be expected to have found out, the position about the MOT before paying the claim. Estoppel would be relevant here I suspect, but I'll leave that debate to the lawyers.  The insurer's explanation of why they didn't check the easily available, free, public domain gov.uk MOT site before paying out would be interesting to hear!

The policy wording will be the key thing for OP to review.

[Dm47]

Hi thanks for all your replies. 

The insurance company name is Markerstudy Insurance services Limited.  They already paid my father last year when he submitted the claim so his car is fixed and now the insurance is trying to get their money back.

I attach 2 letters that they have sent my father.  The 1st letter they sent is saying that there was no valid MOT on the car so the policy conditions have been breached and they are looking for reimbursement. 

Following that letter, my Mother then phoned the insurance which is when the insurance guy scared her that she could be liable to pay for the costs of the motorcyclist and she agreed to reimburse the insurance company the £3k for the repairs to my fathers car. 

The 2nd letter confirms the telephone conversation.   Unfortunately they dont have a copy of their insurance policy. 

At the time of the accident my Fathers car was roadworthy and in no way did the condition of the car contribute to the accident.  The sun was low and he just didnt see the motor cyclist when he pulled out. 

Once he realised he had no MOT, he took it in and it passed with no advisories. 

I am going to ask my parents to email the insurance company stating that the car was roadworthy at the time and we will not be reimbursing them. 

Is this the correct approach? 

 

[Ethel Street]

@Dm47

 

Don't write anything yet, wait and see what others think.

I have had to remove the two letters as both showed your fathers name and registration number of his car, and claims number.  And one was posted as Word document, not a pdf.

Please can you re-upload with all personal information and identifying claims and reference numbers covered up.  Upload as PDFs.

[Ethel Street]

It isn't acceptable client service for Markerstudy to say they don't have a copy of their own policy and can't, apparently, quote you which Condition has been breached. However, the bad news is that I've found a specimen policy form on the broker section of their website and it does require an MOT to be in force. It's General Condition 3 on page 33 here jn4427_markerstudy-private-cargmsf090519_lowres-006-100719.pdf and reads:

"3.Having an MOT certificate

There must be a valid Department for Transport test certificate (MOT) in force for the insured vehicle if one is needed by law. In the absence of a valid Department for Transport test certificate (MOT) all cover under sections A and B of this insurance is cancelled and of no effect"

Best to assume that the actual policy issued issued to your father contains this clause.

So they are putting pressure on you in their second letter to reimburse the own damage amount they paid to your father (£2,860) by 19th June or they will revert to the postion in their first letter that they are also entitled to recover from your father the third party claim that they have paid,  which you speculate could be £80,000+. Because of the the clause in the policy if it were me I'd pay them back the £2,860 to avoid the risk of being found liable in court to repay £80k or more.

I can see from the gov.uk |MOT site that your father's MOT expired 6 May 2022 and the accident occured 22 May, so it was only 15 days overdue. 

I would then consider making a complaint to the insurance ombudsman on the grounds that:

(1) the expiry date of the previous MoT was only 15 days and insurers should have treated it as de minimis.

(2) Insurers knew, or should have known, that the MoT had expired when they paid out the own damage claim so they waived their right to apply General Condition 3.

(3) the vehicle was roadworthy and there is no suggestion that vehicle's condition contributed to the accident.

(4) insurer's refused to give you a copy of the policy to allow you to check whether there was a MOT condition in it.

(5) that you repaid the £2,860 under duress as they threatened to pursue you for £80,000+ if you did not.  There was insufficient time to enable you to complain to the Ombudsman before their deadline.

I'd be interested to see what other posters think.

In the meantime research Insurance Ombudsman decisons on MOT and claims and see if any have similar circumstances to your father's.

Ombudsman decisions

WWW.FINANCIAL-OMBUDSMAN.ORG.UK

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Search our database of final decisions.

 

[Dm47]

I have uploaded my documents as PDFs and taken out all personal information thanks  

1st letter.pdf 2nd letter.pdf

[unclebulgaria67]

Personally, I think you should pay the Insurers the £2860 as full and final settlement.  The problem of going down the FOS complaints route, is that the Insurers decide to dig their heels in and want your father to be responsible for the third parties claim.  Arguably, the car should not have been on the road and the fact that the car was on road ( even though roadworthy) has led to the Insurers having to pay a large value claim. But of course it depends on what your fathers own policy stated. The FOS would want to see the actual policy to understand the exact legal position.

Insurers don't normally take people to court to claim back money they think is owed to them, but this cannot be ruled out.

So you really need to consider how much hassle you can handle.  Go down the complaints route which could take many months and without knowing what the outcome might be.  Or just pay the £2860, if this will conclude the matter.

 

[Ethel Street]

Is there any reason why OP's father can't pay the £2,860 and complain to Ombudsman afterwards? That would be my suggestion.

[unclebulgaria67]

The OP's father could pay the £2860 and complain to the FOS,  but the FOS might conclude that the parties have agreed settlement, so no further investigation is required.  Worse possibility, is that Markerstudy, believe they have a case for asking OP's father to pay them more money that they have had to pay to third party and want to pursue this, as the full & final settlement was not really agreed, as evidenced by ongoing FOS complaint.

[Ethel Street]

My suggestion is that the OP makes clear in an FoS complaint that they agreed to repay the £2,860 under duress because the insurer otherwise is proposing to seek to recover £80k of TP claim as well which (I'm guessing) OP could not afford.  My view is that Markerstudy could not legally use an FOS complaint (a statutory consumer protection mechanism) to undo a contractual F&F. settlement as FOS doesn't make it's decisions like a court would solely on the terms of the contract but on wider principles of 'treating customer fairly'.

 

Up to OP what to do next. I think we are both agreed he should pay the £2,860 to avoid the risk of being pursued for £80k+

[Dm47]

Ok thanks for tour help.  Looks like next steps is to pay the £2800 and submit a complaint to the financial ombudsman.

[unclebulgaria67]

If you want to go to the FOS and try to get a final conclusion that is OK, provided that you understand that someone from the FOS might call to try to end the complaint quickly I.e., you have settled full and final, as a consequence of breaking contract due to no MOT, the Insurers have  acted fairly etc etc etc.

If you then decided to continue the complaint after the first FOS call, you would have to think what outcome you are likely to achieve. I understand the argument about paying the money to the Insurers under duress, but at the end day,  if the policy wording says no MOT invalidates the Insurance cover, then the Insurers would be entitled to the return of the money paid out.

My gut instinct on a case like this, is admit the mistake, pay the price and don't keep digging.

[Dm47]

OK thanks for al your help.  Will pay the insurance cost of my father's car as don't want take risk of having the liability of the motor cycle costs. Thanks all.