Settlement of motor third party claims

ANTHONY J PERERA

With the advent of innovative on the spot and on the scene assessment system of Motor accident claim settlement, the Police Report which has hitherto been mandatory has lost its importance, which is a violation of the Motor Traffic Act. In the process of this 'quick settlement' system the insurers take undue advantage by side-tracking their obligation towards the innocent third party.

If a vehicle waiting at the traffic signals is hit from the rear side, it goes without saying that the driver of the vehicle at the back is at fault and therefore it becomes the responsibility of the insurer of that particular vehicle to repair the damage caused to the stationary vehicle.

Tailgating habits make this kind of accidents common

Due to the bad habit of 'tailgating' in heavy traffic, accidents of this nature are very common now.

The current practice with the insurance companies is to insist on a 'court award' or a judgement before entertaining a claim from the innocent 'third party'. It's a well-known fact that going to Courts is the most time consuming and cumbersome process.

Knowing this so well, the insurers who are actually responsible for the damage to the innocent victim's vehicle, take the undue advantage by insisting on a 'court award'.

If the innocent victim does not hold a 'Comprehensive Policy,' then he will have no alternative but to do the repairs out of his own expenses.

On the other hand, even if he holds a comprehensive policy and his insurers agree to pay, he will invariably suffer loss or reduction of his hard-earned no-claim bonus and will have to bear the first portion of the claim if there is a 'voluntary excess' or a 'compulsory excess' under the terms of the policy.

It is most unethical on the part of the insurance companies to shirk their responsibility in this manner when there is concrete evidence that their client is responsible for the damage.

If they have satisfactory evidence that their insured is at fault and the 'third party' is innocent, there is nothing to prevent the insurer of vehicle at fault of compensate both parties.

Findings of 'on the scene' investigation or the Police Report should be sufficient, to admit liability for Third Party claims. It has now come to a point where the public and higher authorities should call upon all the insurance companies to alter their attitude and honour their obligations in a businesslike and gentlemanly manner. Let them live up to their massive advertising campaigns promising 'fair-play' at all times, in all their dealings.

As an alternative, if both vehicles are insured under comprehensive terms, they can revert to the colonial day 'Knock for Knock Agreement' in terms of which each insurer undertook to repair their client's vehicle even though the damage was caused by another vehicle insured by another insurer.

This system will maintain equilibrium between the 'losses and gains' of each company, as when they are burdened with a claim for which they are not actually responsible, they are at the same time are absolved from paying a claim for which they would have otherwise been responsible.