Motor Insurance (Hansard, 23 June 1993)

§ Mr. Key

Following wide-ranging discussions with representatives of the insurance industry, the police and the Home Office, we have decided not to require evidence of insurance to be displayed on a vehicle windscreen. Under our present driver-related insurance system, the enforcement benefit would be little more than is already provided by the check on insurance which is made when renewing vehicle excise duty. The display of an insurance disc would provide no assurance that the driver was covered by an insurance policy or complying with policy conditions, nor would it protect against the insurance being cancelled once the disc has been issued.

The enforcement potential of a windscreen display would be greater under a vehicle-related insurance regime, where cover is taken out for a particular vehicle regardless of who drives it. However, this would require all vehicles to be insured for any driver and so remove an insurer's ability to take account of the risks associated with different drivers. Because every insured vehicle could be driven by a high-risk driver, the contribution that the present insurance system makes to road safety would be undermined. It could lead to a substantial increase in motor premiums, especially for safer drivers who would, for example, find themselves contributing to the cost of insuring all cars to be driven by novice drivers or by drivers with a poor accident record. Premium increases could in turn encourage further evasion and render the measure self-defeating.

I deplore the irresponsible behaviour of the minority of drivers who fail to take out insurance. But I am sceptical 172W about imposing further regulations on all drivers, particularly when we cannot be confident that insurance evasion would be significantly reduced. The police already have wide powers to inspect insurance certificates, and there are over 200,000 convictions for uninsured driving every year. The maximum for this offence was increased to £5,000 in October 1992. We have decided as a result of our discusions that the format of insurance certificates should be reviewed and simplified where possible to assist the police in checking them. This will speed up this important aspect of enforcement. A further check on insurance certificates is made with applications for vehicle excise duty.

The decision not require the display of windscreen insurance discs has no effect on the compensation received by those involved in road accidents. Victims of uninsured drivers will continue to be compensated by the Motor Insurers Bureau under a long-standing agreement between the bureau and the Secretary of State for Transport.