UK motor insurers have voted to ensure that the Motor Insurance Bureau (MIB) will handle terrorism claims where vehicles are used as weapons. The move has been welcomed by the British Insurance Brokers' Association (BIBA).
The MIB is the UK’s not-for-profit body which deals with claims from victims involved in uninsured and ‘hit and run’ accidents. Every motor insurer writing business in the UK is required to be a member and is obliged to pay a levy as part of that membership.
Previously, under Article 75 of the MIB’s Uninsured Drivers Agreement, insurers were obligated to compensate victims of vehicle-related terrorism claims from their own funds. Due to the growing numbers of terrorist attacks involving vehicles in the past year, the MIB asked its members to vote on whether the MIB should now handle and pay claims from victims involved in vehicle-related terrorist attacks.
Following a 28-day ballot that closed on Thursday 19 July, the MIB announced that more than 75% of its members agreed to the change. Over 40% of members also voted in favour of compensation being from ‘the ground up’ rather than limiting claims above a certain threshold.
In response to the outcome, Dominic Clayden (Chief Executive at MIB) remarked that, “those who are innocently caught up in events where terrorists drive vehicles into people to injure and kill can rely on MIB to pay and handle their motor related claims for these terrible events.”
The incoming changes have been supported by Graeme Trudgill (BIBA’s Executive Director) who commented, “BIBA believes this vote by MIB members to mutualise motor terrorism risk is absolutely the right thing to do. Gaps in terrorism cover were highlighted in our 2018 manifesto and we committed to helping the market find solutions. The use of a vehicle as a weapon is not what motor insurance is designed for and it would be wholly unfair, not to mention unsustainable, to hold a single motor insurer responsible for any subsequent compensation payments”.
The MIB also announced that it may look to reinsure some of the liability arising from the changes.