HIRE CAR PASSENGERS (INSURANCE) (Hansard, 7 May 1962)

§ Sir Charles Taylor (Eastbourne)
I know, Mr. Speaker, that because of the very nature of the subject of the debate, I may find it difficult to keep within the bounds of order, but I hope that with your leniency and my limited Parliamentary experience we shall get on all right. I want to raise the very sad case of some of my constituents who were involved in an accident some time ago when driving a hired car.
The car had been hired as a result of an advertisement in a newspaper. I shall not mention the name of the garage concerned, because it is unimportant. It is common practice, I believe, for all garages that hire out self-drive cars to use the same sort of advertisement. The advertisement read: … garage offers everything for self-drive hire. Latest models. Full comprehensive insurance. One would think that the advertisement meant what it said—full comprehensive insurance.
When the accident occurred, the car contained a driver, a young boy and his girl friend—both in the front—and two passengers in the back seat five people in all. Due to patches of fog, the driver missed a "Halt" sign, and collided with a motor coach. The two front-seat passengers were badly injured. The young boy was at once taken to hospital, where he remained unconscious for five months, and subsequently died without regaining consciousness. The girl was also very badly injured, and stayed in hospital for some time.
The girl's father referred the matter to his own solicitors, and also to the Automobile Association. His solicitors wrote: I have heard from the X Insurance Company"— again, I do not want to mention the name because all the insurance companies are the same about this subject"— that the only cover provided by the policy in respect of passengers was for medical expenses up to a limit of thirty guineas for each passenger. 177 The Automobile Association wrote: To refer generally on the particular query you have raised, a comprehensive contract of insurance would not necessarily include passenger liability. The insurance of passengers in motor vehicles is not compulsory within the terms of the Road Traffic Acts. Therefore, whilst a comprehensive"— and I underline the word "comprehensive"— contract of insurance may be issued to a policy holder, the insurance underwriters, if they so desire, can cancel passenger liability for various reasons. A great deal would depend on the type of person to be insured and the vehicle which is to be driven. Had the unfortunate boy survived—and I am sure that we would all wish to offer sympathy to the relatives and all concerned in this unfortunate accident—he might, through no fault of his own, have been a continuing liability to someone for the rest of his life. He might have been crippled or paralysed, or he might have had some brain injury. The same applies to the other passengers.
I realise that I cannot this evening suggest that there should be any change in the law. But most certainly I ask the Minister of Transport to reconsider the existing Acts in the light of this case. There are other suggestions which I shall make later which need not necessarily involve any legislation, although I should say that I am seriously considering introducing a Bill—under the Ten Minutes Rule, or by the presentation of a Private Member's Bill—which might effectively deal with the situation; that is, if the Minister does not do it first.
Since I asked a Question some weeks ago about these points, I have received a most informative letter from a lady, not one of my constituents, who puts the points so well that I would like to read certain extracts from it. She writes: In the last couple of years I have had occasion to hire a car, self drive, several times. I have tried out various agencies, trying to find one which is best suited to my purpose. In every single case I have had trouble and in most cases have come up against a brick wall over the insurance of passengers. The first time I hired through British Railways, who gave the business to a private hirer. The writer goes on to say that this private hirer informed her that he would try to arrange passenger insurance, but, in fact, he did not arrange it.
178 The writer continues: On the second occasion I hired from a private firm direct who said that they thought they could arrange it, but they did not do so. The third time I hired through a large London store who said that it would be difficult and, anyway, quite unnecessary and, of course, they did not arrange it. The fourth time I hired a car from another firm who said there was no demand and that I should have to arrange passenger insurance myself. The fifth time I hired through B.E.A. The whole hire was a fearful muddle and the officers at B.E.A. seemed to know nothing at all about hiring cars"— I do not see why perhaps they should— but I wrung from them the information that I could insure passengers by filling up a separate form and paying separately. They did not have the form but promised to send it to me in a fortnight. They did not send it and I had to remind them. When I got the form I found I must have a receipt for having paid in advance for the whole hire, although B.E.A. told me that I did not have to pay in advance. I paid in advance but I got the policy after the hire was over. The letter goes on to say: Of course, if I should have the misfortune to have an accident which injures a passenger I should hope that it would not be my fault, but I am not perfect and I am quite aware that I could find myself in the position of paying damages to a passenger. Therefore, I wish to be covered against this risk. It appals me to think that most car hirers are not insured against the risk of a passenger being injured in an accident where no third party is involved, for example through a skid or a burst tyre. How many people who take a lift from a friend or a stranger would be so happy to do so if they knew that they were not covered in case of accident?

§ Mr. Speaker
Order. I share with the hon. Member the confidence that he can bring himself in order. I have been patiently listening to his speech and perhaps he will now be good enough to come to the remedy he seeks, or can seek, which does not involve legislation.

§ Sir C. Taylor
I am coming to that, Sir. With great respect, I am reading this letter which, I think, gives the background to the proposals I want to make and which will not need any legislation.

§ Mr. Speaker
If the hon. Member will give me the answer to my question I need not again interrupt him. I do not desire to interrupt the hon. Member and I would be grateful if he would give me the answer so that he may continue with the background.

§ Sir C. Taylor
The background is part of my argument. If I may continue to give it, particularly the case of this woman, I will come to my suggestions. In this letter this lady is not suggesting that there should be legislation. She is merely relating her experiences.

§ Mr. Speaker
Order. I am not desiring to interrupt the hon. Member further than my duty requires, but to bring the background he is giving within the rules of order, which I have to keep, would he be good enough to indicate what is the remedy which, he says, does not involve legislation as its main theme?

§ Sir C. Taylor
I intended to suggest in a few minutes that certain things should be done by voluntary methods, by suggesting to the car hire firms that they should adopt certain courses. That is all.

§ Mr. Speaker
There again, we come up against another difficulty. There must be some Government responsibility before I can permit this argument in an Adjournment debate.

§ Sir C. Taylor
I fully appreciate that, Mr. Speaker. I agree with that entirely. But the Government have not been slow in making recommendations to various people about how they should or should not conduct their business, without any need for legislation.
May I finish the letter? There is only one more paragraph. It rather destroys the continuity of my argument if I have to bring the latter part of my remarks further forward instead of uttering them after I have finished the background. The lady continues: You may be interested to know that when I got the B.E.A. policy I found that it did not cover an accident. This is a quotation from the B.E.A. policy: to any person who at the time of sustaining such injury is engaged in the service of and/or acting on behalf of the insured and/or being carried as a result of a contract or agreement … She continues: This would seem to me that if you gave your baby-sitter or charlady a lift she would not be covered. Incidentally, in all that I have said I am thinking of the non-driving passenger. All hirers seem to be able quickly to arrange cover for several people travelling in a car, all being insured up to statutory minimum third party if they are to drive 180 occasionally which allows several people to go off on a holiday together. But the one who is not driving is not covered if the driver causes an accident. If the Minister is unable to say that he will look at the law again to see if it is satisfactory or adequate in present-day conditions, I should like to make the following suggestions. First, all car hirers should be asked to make it clear, in bold red lettering, that passengers are not covered in the case of accident. I should hope that if they were asked to do that voluntarily, they might well consider doing that—

§ Mr. Speaker
They might be asked by an elder of the kirk or some other individual. The point is: is there Ministerial responsibility in some form for these measures? If not, I cannot in accordance with my duty allow the hon. Member to urge that course.

§ Sir C. Taylor
The Minister of Transport enjoins us from time to time to drive our cars carefully. There is no legislation needed for asking us to drive our cars carefully. The Minister of Transport enjoins us to drive our cars carefully and not to drink when driving. There is no legislation which compels one not to drink before driving a car.

§ Mr. Speaker
I am not sure about the accuracy of the hon. Gentleman's proposition. There is legislation which makes it an offence to drive when under the influence of drink or drugs so as to be incapable of having proper control of the vehicle. There is legislation which makes it an offence to drive dangerously or without due care and attention. It is not true to say there is no law to enforce these things.

§ Sir C. Taylor
That is after the offender is caught. With the greatest of respect, the Minister of Transport asks drivers of motor cars to be careful about driving their cars, and I am merely suggesting that this should be on the same basis—that he should also say to the car hirer "Please bring these dangers to the notice of your drivers." Surely, Mr. Speaker, it would be quite within the bounds of possibility for the Minister of Transport, who frequently gives us advice about many matters, to give that advice without any legislation whatsoever.
181 The second point I should like to make is that they should also be asked to place in a prominent place in the car a notice to the effect that passengers riding in the car are not insured. Thirdly, they should be asked to provide passenger insurance forms readily available at the hirers' offices so that a person hiring a car may be fully aware whether he is covered or whether he is not. In passing, I would say that I hope that the Automobile Association and the Royal Automobile Club and the British Travel and Holidays Association will give full publicity to these facts so that passengers who are not insured do realise that they are not insured while in hired cars.

§ Mr. Speaker
The hon. Member drives me further than I may allow myself to be driven. The Minister is not responsible for the activities of the Royal Automobile Club or the other bodies to which the hon. Member has referred, and he cannot be charged with responsibility by virtue of this debate.

§ Sir C. Taylor
No, Sir, but the British Travel and Holidays Association is a Government-sponsored body and the President of the Board of Trade is responsible for the activities of the Association. It may be supported by voluntary contributions, but the Minister is responsible for its activities and, indeed, appoints the board, and I am suggesting that tourists coming to this country should be aware of the dangers which they are liable to meet if they do become passengers in hire car firms' cars, which a great many tourists, from America and other countries, do hire when they come over here.

§ Mr. Speaker
I am very sorry to interrupt so much, but I cannot allow the hon. Member to persist by these devices. No one can suggest that there rests in the Minister of Transport any responsibility here for these bodies who look after the interests of tourists.

§ Sir C. Taylor
The British Travel and Holiday Association is a Government-sponsored organisation—

§ Mr. Speaker
Did the hon. Member give notice to the Minister responsible for the activities of this body?

§ Sir C. Taylor
Well, I felt that one Minister tonight to reply to this debate should be sufficient, and I am sure my hon. Friend the Parliamentary Secretary will pass on the comments I have made about the British Travel and Holidays Association and about overseas tourists to this country and the dangers to them in driving in uninsured cars.
I am sorry that you have found it so necessary to interrupt my humble remarks this evening, Mr. Speaker. I apologise if you think I have been out of order, but I did consider very fully what I was going to say and I do feel that something has to be done about this, either by guidance or by legislation. Now I will listen with great eagerness to what the Minister has got to say.

§ The Parliamentary Secretary to the Ministry of Transport (Mr. John Hay)
My hon. Friend the Member for Eastbourne (Sir C. Taylor) has taxed my ingenuity to the utmost in saying that he awaits with eagerness the observations I propose to offer to the House. Indeed, I am in great difficulty, as you yourself, Mr. Speaker, will realise, in attempting to answer a debate on a matter which, frankly, is not entirely within the responsibility of my right hon. Friend the Minister of Transport. I think the best thing that I can do to help my hon. Friend is to outline as briefly as I can what the existing position is and then to say something about the suggestions he has had to make.
The present law relating to third-party motor insurance is contained in Part VI of the Road Traffic Act, 1960, and the Section which is involved in the sort of situation which my hon. Friend has in mind is Section 203. Briefly, the position is that all third-party liabilities, including liabilities to passengers, have to be covered by insurance. There are, however, two exceptions: first, liabilities to employees—and I add in parentheses that, normally, these are covered by employer's liability policies—and, secondly, liabilities to passengers who are not paying fares or who do not travel at the request of their employers. Thus, anyone who is what we call a voluntary passenger in a motor vehicle, that is, someone who journeys in the vehicle not paying a fare and not as a 183 result of his employment, is not obliged to be covered by compulsory insurance by the owner or operator of the vehicle.
This is the case with the ordinary private car, and it is precisely the same situation for the private hire vehicle. If I choose to give my hon. Friend a lift in my own motor car, and there is an accident as a consequence of which he is injured, he may have a claim against me for my negligent driving, but I have committed no offence if I do not have third-party cover against any injury which he may suffer. In fact, I have such insurance. The truth is that about 80 per cent. of motor car owners have such insurance because that is usually what is meant by full comprehensive insurance. It covers virtually all the possible risks which the owner of the car may be up against.
Similarly, if I hire a car and carry my hon. Friend in that, not in my own car, then I am not obliged to insure against any liability I may have towards him. With respect to my hon. Friend, I do not see the distinction between the person who runs his own car and gives his friends or relatives or other people lifts and the person who hires a car and then gives lifts in that.

§ Sir C. Taylor
There is a difference.

§ Mr. Hay
My hon. Friend says that there is a difference, but, frankly, I do not see it. Where the vehicle is used for a business—where, for instance, the passenger travels in a taxi or in a bus and he pays a fare—then the law clearly places an obligation on the operator of the vehicle, the person who carries the passenger for hire or reward, to insure that passenger compulsorily against any third-party risks; but where what happens is that the vehicle is in the ownership of the driver, in the one case, or is hired by the driver, in the other, I do not see the distinction, or why there should be any great difficulty. I will give way to my hon. Friend if he has a point to raise.

§ Sir C. Taylor
There is a difference in that the normal private car owner knows what his liabilities are, and he knows about his insurance policy. If his own car is in "dock" and he hires temporarily a "drive yourself" car and he 184 is told that there is full comprehensive insurance, he naturally supposes that there is and that it is all-embracing.

§ Mr. Hay
With respect, I think that my hon. Friend has forgotten that the majority of car insurance policies, so-called, are, in fact, insurance policies relating to the individual, not the vehicle. What happens is that anyone who takes out a full comprehensive policy takes it out in respect of himself, and he declares that he has a certain vehicle. If, as frequently happens, he drives someone else's car, whether it be a friend's or a relative's car, or one which he hires, his insurance continues and he and his passengers are still covered.
Briefly and very quickly, that is the legal situation. I must tell my hon. Friend, since he seems to have a doubt about it, that so far we have had no great pressure in the Ministry of Transport for any alteration of that situation. A proposition was before the House last year, when the hon. Member for Loughborough (Mr. Cronin) introduced his Motor Vehicles (Passenger Insurance) Bill. This caused a great deal of public agitation and anxiety and, eventually, on 23rd June last year, the Bill was talked out on Report.
It was quite evident to us in the Ministry of Transport at that time that, although there was perhaps a case to be made for making third party insurance compulsory in respect of passengers, in the House there was certainly no overwhelming majority for it. In those circumstances, I cannot really say that there is any likelihood of that situation being repeated in the foreseeable future.
I pass to the suggestions my hon. Friend made. I applaud his ingenuity, but I cannot applaud the sagacity of his suggestions. He was suggesting that my right hon. Friend should approach car hire firms asking them to indicate by notices and in various other ways the risks that passengers not covered by insurance would run. I do not think that the great majority of car hire firms would take kindly to advice of this kind by my right hon. Friend, and, indeed, if it is accepted that the majority of people who are already car owners and who have comprehensive insurance cover for themselves hire out cars either for themselves to drive or for their employees to drive, I think that these people would 185 probably be very cross if they were faced in the booking offices of car hire firms with notices saying in large red letters that passengers travelling in the vehicles hired out are not covered by insurance.

§ Sir C. Taylor
But can be.

§ Mr. Hay
My hon. Friend says "But can be".
That brings me to another point. I am advised that the great majority of car hire firms, and certainly the big ones, inform people who come to hire cars from them that if they wish they can have extended cover to cover the situation of passengers. The lady who wrote a letter to my hon. Friend experienced difficulty in connection with this, but I 186 have no information to show that that sort of experience is general.
I am very sorry to tell my hon. Friend that that is about all I can tell him about this matter. In the Ministry of Transport we have no evidence that there is a widespread abuse of the law. We have no evidence that there is a widespread demand for changes in the law, and unless and until there is, frankly I think that my right hon. Friend would take the view that no action on his part is called for and would somewhat repudiate any responsibility for the existing situation.