Untraced Claims against the Motor Insurers Bureau (MIB)
21 September 2011
By Ed Tomlinson, Financial Planner
The MIB was established in 1946 to compensate the victims of negligent uninsured and untraced motorists. Under the Road Traffic Act 1988 every insurer underwriting compulsory motor insurance is obliged to be a member of the MIB. The MIB is a company limited by Guarantee and is funded by its members.
The MIB do not automatically meet the criteria of reasonable security, as set out in section 2(4) of the Damages Act 1996 (as amended), however they have proved to the Court that they are a secure funder of periodical payments in the case of, Thacker v Steeples & MIB Cox J QBD London 16 May 2005. Briefly, Cox J and Master Lush were satisfied on the evidence provided that the MIB were secure providers of periodical payments. This was because of the MIB’s longstanding nature, the number of members and (most importantly) the MIB is the body through which the Government meets it obligations under Article 4 of the Second European Directive on Motor Insurance, to provide compensation to victims of uninsured and untraced drivers.
Practitioners in this area will be aware that there are two distinct tracks that claims against the MIB can follow, Uninsured and Untraced, for which there are separate agreements:
The Uninsured Drivers Agreements 1988 and 1999, requires the MIB to meet unsatisfied Civil Court Judgments against identified motorists who may not have been insured as required by the Road Traffic Act 1988.
The Untraced Drivers' Agreements 1996 and 2003, requires the MIB to consider applications for compensation from victims of "hit and run" motorists.
It is clear that in cases proceeding against the MIB under the Uninsured Drivers Agreement that the MIB are a secure provider of periodical payments because all of the case law relates to the Uninsured Drivers Agreement. Furthermore claims under this agreement are settled in Court and any periodical payment would be confirmed in a Consent Order.
In a recent case that IM Asset Management were involved in, the MIB have confirmed that the Untraced Drivers Agreement claims are paid from the same fund (that Uninsured claims are paid from) and therefore claims under the Untraced Drives Agreement are also secure providers of periodical payments. Furthermore, the terms of any periodical payment would be included in a Memorandum of Agreement which both parties would sign providing the claimant with an agreement.
For professional clients only, not for onward distribution. IM Asset Management does not take responsibility for the accuracy of information provided by third parties.
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