s.144 Road Traffic act 1988
Discussion
I've always wondered about this particular provision:
Exceptions from requirement of third-party insurance or security.
(1)Section 143 of this Act does not apply to a vehicle owned by a person who has deposited and keeps deposited with the Accountant General of the [Senior Courts] the sum of [£500,000], at a time when the vehicle is being driven under the owner’s control.
So, by the looks of it, you can drive around without insurance if you deposit £500,000 with the Accountant General.
I wonder what the thinking was behind this. There is no mention of the AG paying out to any third parties of the depositor gets involved in an accident.
Exceptions from requirement of third-party insurance or security.
(1)Section 143 of this Act does not apply to a vehicle owned by a person who has deposited and keeps deposited with the Accountant General of the [Senior Courts] the sum of [£500,000], at a time when the vehicle is being driven under the owner’s control.
So, by the looks of it, you can drive around without insurance if you deposit £500,000 with the Accountant General.
I wonder what the thinking was behind this. There is no mention of the AG paying out to any third parties of the depositor gets involved in an accident.
its called self insurace, you would still be liable for any costs against you if you had an accident. for example if you crashed into someone and i was your fault and that person needed specialist medial care for the rest of their life you would have to pay for it which has the potential to cost millions
As hobbiniho says, it allows you self insure (i.e. to carry the risk of having to pay any claims yourself). The advantage of doing so would the savings on premiums.
When the 1988 Road Traffic Act was introduced the amount was only £15,000. This was amended only 3 years later to £500,000. I suspect people realised quite quickly that £15,000 was nowhere near enough money to demonstrate that you had enough funds to be able to pay the kind of damages that could result from a car accident. It was probably easier to massively increase the figure rather than remove the entire section on exemption as that would have obliged local and central government to pay out millions of pounds a year in premiums.
When the 1988 Road Traffic Act was introduced the amount was only £15,000. This was amended only 3 years later to £500,000. I suspect people realised quite quickly that £15,000 was nowhere near enough money to demonstrate that you had enough funds to be able to pay the kind of damages that could result from a car accident. It was probably easier to massively increase the figure rather than remove the entire section on exemption as that would have obliged local and central government to pay out millions of pounds a year in premiums.
HantsRat said:
This is what millionaires do.
And large companies/organisations. A company which runs a fleet of hundred or thousands of vehicles knows, to good approximation, how many accidents its vehicles are going to be involved in each year, and may well find it cheaper to set aside a budget to pay the third party costs than to insure its cars. Possibly it would also get a (relatively) cheap non-RTA compliant insurance policy with a massive excess which would cover itself against the risk of the occasional catastrophic injury claim, but not the day to day accidents.I guess depositing the half a million quid basically serves as evidence that your credit is good and you can afford to settle claims yourself.
Aretnap said:
I guess depositing the half a million quid basically serves as evidence that your credit is good and you can afford to settle claims yourself.
No it doesn't. It stops you from having no assets when you get the damages claim.I wonder what the practicalities are for when you get stopped for not being on the database?
BertBert said:
No it doesn't. It stops you from having no assets when you get the damages claim.
I wonder what the practicalities are for when you get stopped for not being on the database?
Just issue yourself a certificate, I'm guessing that what you pay (£500k) is just a bond, so with the bond / self issued cert you'd be fineI wonder what the practicalities are for when you get stopped for not being on the database?
BertBert said:
Aretnap said:
I guess depositing the half a million quid basically serves as evidence that your credit is good and you can afford to settle claims yourself.
I wonder what the practicalities are for when you get stopped for not being on the database?This is interesting, I always thought it was more (5mill) and I thought it was the legislation for setting up and legitimately becoming an insurance underwriter. But on reading it doesn't read that way, its also interesting that its worded as 'own' not 'drive' I could own 1000 cars and then anyone could drive them without insurance (well I'd be insuring them) obviously the risk would be extreme.
I assume that if you decide to go the more conventional insurance route you get the full £500,000 back.
I assume that if you decide to go the more conventional insurance route you get the full £500,000 back.
HantsRat said:
This is what millionaires do.
They can deposit £500k and then be insurance against any vehicle they own. It saves taking up a separate policy for each vehicle.
No it isn't you doughnutThey can deposit £500k and then be insurance against any vehicle they own. It saves taking up a separate policy for each vehicle.
they go to a broker or have a fleet policy.
£500k laying about would easily give you a return of £25-50k a year invested in low risk stuff, you'd have to have a monster fleet to be paying even close to £25k+ a year to insure it.
Doughnut hehehe.
I presumed this was what the policy behind this provision was. I know that one major Police force has public liability insurance which has a policy excess of £500k so it ties in nicely.
The thing is though, there is no mechanism in the RTA to ensure that any third party liabilities are paid out of the £500k held by the AG. s.144 is the only mention of lodgement of that sum.
Anyway, it would be amusing to be driving around in a battered old car and when pulled by the Police, producing evidence of lodgement of half a million pounds with the AG.
I presumed this was what the policy behind this provision was. I know that one major Police force has public liability insurance which has a policy excess of £500k so it ties in nicely.
The thing is though, there is no mechanism in the RTA to ensure that any third party liabilities are paid out of the £500k held by the AG. s.144 is the only mention of lodgement of that sum.
Anyway, it would be amusing to be driving around in a battered old car and when pulled by the Police, producing evidence of lodgement of half a million pounds with the AG.
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