Estimated figures published by the Department of Environment, Transport and the Regions in 2001 make for some grim reading, indicating that:
- Insurance evasion was running at between 4 and 6% of all vehicles in use
- Between 1 million and 1 ¼ million of vehicles on the roads were uninsured
- Accidents for which uninsured drivers were responsible cost the motor insurance industry over £400 million in 1999
- As a result each insured motorist ended up paying a further £15 to £30 premium on their policy
This remains an ongoing problem and it is now estimated to cost £500 million per year.
Where an accident occurs and an innocent party suffers injury it will more often than not be the case that the damages are paid out by the third party policy holder’s insurance company.
However, when the vehicle of the guilty party is uninsured one of the options available to recompense injured parties is via the Motor Insurers’ Bureau (or MIB).
The MIB was established in 1946 to compensate the victims of negligent uninsured and untraced motorists.
The Uninsured Drivers’ Agreement 1999 deals with claims arising from the negligence or intentional assaults of uninsured drivers who can be identified and sued. It does not deal with untraced drivers.
The MIB is funded by levies charged upon insurance companies, and so effectively their funds come from the insurance premiums paid by members of the public to those insurers. When notified of an uninsured claim the MIB will attempt to negotiate settlement in the same way as an insurer would to minimise costs.