Overview

This bill amends retained EU law concerning compulsory motor insurance in the UK. It clarifies the scope of compulsory insurance, limiting it to motor vehicles used on roads or other public places, thereby removing coverage for other vehicles or locations.

Description

The bill modifies the Road Traffic Act 1988 by adding a new section (156A). This section alters the interpretation of the 2009 Motor Insurance Directive (Directive 2009/103/EC), specifically Article 3. The key change restricts compulsory insurance to liability arising from the use of motor vehicles on roads or public places in Great Britain. Liability for the use of non-motor vehicles or vehicles used off public roads is excluded from the scope of compulsory insurance. The bill also revokes certain rights to compensation (referred to as "relevant section 4 rights") in cases involving vehicles outside this narrowed definition. Existing case law conflicting with these changes will be superseded. The amendments only apply to incidents occurring after the enactment of the Motor Vehicles (Compulsory Insurance) Act 2021.

Government Spending

The bill is not expected to significantly impact government spending. The changes clarify existing legislation, and the potential financial implications relate more to insurance companies and individuals rather than direct government expenditure. No specific figures are provided in the bill text.

Groups Affected

• Motorists: The bill primarily affects motorists by clarifying the circumstances under which compulsory motor insurance applies. The scope of coverage is reduced to incidents involving motor vehicles on roads and public places.
• Insurance Companies: Insurance companies will need to adjust their policies and procedures to reflect the narrowed scope of compulsory insurance.
• Individuals injured in accidents: Individuals injured in accidents involving vehicles excluded by the bill (non-motor vehicles or those off public roads) may find it harder to receive compensation, depending on the specific circumstances and the actions of the at-fault party
• Legal Professionals: The legal profession will need to adapt to the changes in the law, and deal with cases that fall outside the narrowed scope of compulsory insurance

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