New motor insurance legislation 'will help the industry'

Two new pieces of legislation should help motor insurance providers to contain costs in the new year, it has been reported.

Ian Crowder of AA Insurance Services explained that, from April, the law is set to allow electronic delivery of insurance certificates.

He said this is something the industry has been lobbying for, especially in light of the postal strikes of 2009.

Speaking to the Scotsman, he noted that the certificate is "little more than confirmation that the information it carries is on the national Motor Insurance Database, from which the police draw data for their automatic number plate recognition equipment".

Mr Crowder added that this is "very successful" in helping to identify uninsured and untaxed vehicles and is also used when people apply for tax discs online.

A new offence of "keeping a motor vehicle without insurance" should also help stem the tide of uninsured drivers, he added.

"It removes the excuse that a car kept on a drive is uninsured because it isn't used on the public highway. Either a car must be insured, or be subject to a Statutory Off-Road Notification to the DVLA and if neither are in place, the owner will suffer a fixed penalty and the risk of having the car confiscated," Mr Crowder said.

Last week, the Financial Ombudsman Service urged drivers to be aware of the small print in their car insurance policies, particularly where exclusion clauses are concerned.

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2009-12-30 09:47:04 © Moneyextra.com