INSURANCE NIGHTMARE

I read in a bike touring magazine in UK yesterday of a guy that sold his bike but did not cancel the Insurance, he left it to run its time so he could have another full years NCB.
However the new owner used it without insuring it himself & had an accident.
The Insurance company are now holding the previous owner responsible for any damages paid out as they consider him guilty of letting an uninsured rider use the bike.
The moral of this is to remove the sold bike from your policy as soon as you sell the bike or cancel the policy completley.
I am not sure if transfering the policy to another bike you have just purchased would absolve you from any responsiblity on the old bike so its worth checking with your insurance provider & get it in writing.
This rule may only apply in UK & EU but it was confirmed as correct & lawful by a legal expert & in an extreme case the insurers could come after your house or any assets you have.
I am not sure on exact details of this law but ALL car & motorcycle users should be aware of it.
I belive the law is an EU idea to protect 3rd party victims from not being able to get compensation from uninsured road users.
Food for thought !!!!!!!.

Hi,I just dropped in to say I have sold my bike but will leave the insurance policy in place thanks. (Eric Idle voice)

Hello Sir,You want to continue paying a policy on a vehicle you do not own and have on sold to a complete stranger who might actually use said vehicle on the road ? (John Cleese voice)

Yes,that's right wouldn't want to jeopardize the old 'no claims bonus.

????

Your legal liability for traffic infringements accidents etc end when the vehicle is transferred to a new owner in the registration system.
So it should be impossible for any insurance Co to argue otherwise. ??

It seems to be suggesting a full cover policy against accident damage etc.
In Australia a personal injury green slip can transfer with ownership change.
If you had a full cover policy and let a mate ride the bike and he crashed it ?

You must inform the Road Transport Authority here on change of ownership to protect you from traffic infringement penalties incurred by the new owner.

Hi all. Like I said in my original post, this was a legal advice letter in a motorcycle magazine but I don't know all the ins and outs of exactley What happend. I was just giving a friendly bit of advice to fellow Norton owners.

I did'nt expect the spanish inquision.

If in doubt just ask about it with your insurer.
Cheers Don

Its not always a good idea to run such weird things by your insurer ?
It gives them ideas they wouldn't naturally come across ?!

How would the subsequent owner have access to the details of the original owners insurer, we wonder ?

This 'advice' sounds decidedly suspect, we thinks.
May we ask the name and date of the magazine source here ?

It was motorcycle touring which I read on saturday morning in ASDA (walmart to some of you)
Its the latest edition of the magazine. You know when your wife is shopping for grocerys and your sent away to read magazines so you don't get in her way. Its in the letters or legal advice page. Check when your shopping next. I'm not going to buy the mag as I live in yorkshire.

I did'nt expect the spanish inquision

NO ONE EXSPECTS THE SPANISH INQUISITION (Michael Palin voice)

Same question has come up on Pepipoo, not an EU problem (just this time )

http://forums.pepipoo.com/index.php?showtopic=83128

MIB in this case is Men in Blue eg UK police.


It's been this way for decades due to the wording of the RTA

"Subsection (1) above applies to judgments relating to a liability with respect to any matter where liability with respect to that matter is required to be covered by a policy of insurance under section 145 of this Act and either—
(a)it is a liability covered by the terms of the policy or security to which the certificate relates, and the judgment is obtained against any person who is insured by the policy or whose liability is covered by the security, as the case may be, or
(b)it is a liability, other than an excluded liability, which would be so covered if the policy insured all persons or, as the case may be, the security covered the liability of all persons, and the judgment is obtained against any person other than one who is insured by the policy or, as the case may be, whose liability is covered by the security."

http://www.legislation.gov.uk/ukpga/1988/52/section/151 section 151

Which basically means if there's a policy in place on the vehicle the Insurers who issued the certificate are liable for any injury or damages caused by drivers even if they're not named on the certificate or a car thieves providing they're identified eg the police catch the car thief etc.

It's a quirk of the RTA which reduces the amount of claims the MIB have to pay.

If the Insurer pays out under this section they will normally chase the policyholder to recover their outlay (Assuming they have assets) as it's something they would not have had to pay out had the policy been cancelled. Obviously they do not pursue their policyholder for the actions of a car thief whilst the car belongs to the policyholder.

If the Insurers did not pursue their outlay, they would pass the costs on to all of the policyholders so innocent clients would end up paying towards the actions of people who could not be bothered to cancel their insurance.

Hi Kommando,
Thanks for the info. Im sure a lot of people were not aware of this, I know I was'nt.
I know my daughter just let a policy run its course for a couple of months when the car went to a scrap yard.
The refund for the last 2 months was pennies, if anything at all. However, it did give her another full years NCB which maybe saved her an extra 10% discount when she purchased the next car a few months later.
As you are in the know Kommando, I assume if you transfer the policy to another bike & get a new cover note without the old bike on it then you are not responsible for any accidents the old bike is involved in by an uninsured rider ?
Cheers Don

As soon as the registration changes on the policy then you are in the clear. I did not cancel a policy on a car that went to a scrap yard as the cancellation fee was greater than the refund with only a month to go but will scrap cars differently next time.

In the USA most states have a perforated tag on the bottom of a title that the previous owner is supposed to send to DMV to show change of ownership. As often buyers don't bother to change the registration. Probably because they need proof of insurance to do it. The previous owner can be held liable for any actions resulting from the use or abandonment of the vehicle up until the time this form is processed. This is why in this day and age many people go to DMV to finalize the sale of a used vehicle, to ensure there is no lag in getting the transfer recorded. I had a local DMV representative tell me I was an idiot if I didn't do my transactions this way!

Russ

Few years ago a mate sold his car and didn't bother sending the change of ownership form off. Fast forward a couple of weeks and the Police broke his door in and dragged him off for questioning, it turns out the car had been used in a ram raid and as he was still the registered owner he attracted the above , he had a real time convincing the cops it wasn't him.
sam