Motor Insurance

Non-reporting of Accidents

1. What should you do if the other party fails to report a non-injury motor accident to his insurer?

You may contact the third party’s insurer, which will then remind its policyholder to file an accident report. If the policyholder fails to file the report despite his insurer’s reminders, the insurer will inform the Traffic Police, which will then remind the policyholder to file the report.

2. Why do insurers require an accident report from their policyholder before acting on a third-party claim?

Insurers require an accident report from their policyholders or insured drivers before acting on a third-party claim to make sure the claim is valid and their insured driver was indeed involved in the accident. Then they can investigate the accident to determine if their insured driver was at fault in the accident and to what extent they are responsible for it.

3. Does your insurer need an accident report from the other party if it is also the insurer of that party?

Yes, it does. The motor insurers review accident reports filed by their policyholders or insured drivers and the third party to establish which party is at fault, and then determine the liability to be assumed by each party. Without such reports from both parties, insurers face a great challenge to assess liability from each party.

4. What happens if a policyholder fails to make an accident report?

Policyholders face serious consequences if they fail to file an accident report. As this constitutes a breach of the insurance policy condition, the insurer can repudiate liability, resulting in the insured’s loss of protection under the policy. Insurers may also cancel the policy, decline to invite renewal of policy or confiscate the NCD entitlement of policyholders if there is any delay in reporting accidents.

5. Can an insurer refuse liability because the policyholder has not reported the accident?

The law governing third-party risks arising out of the use of motor vehicles is the Motor Vehicles (Third-Party Risks and Compensation) Act 1960 (“MV Act”).

The MV Act stipulates that insuring against third-party death or bodily injury is compulsory, and an insurer cannot refuse liability on the ground that the policy holder has not reported the accident if the third-party’s claim is for bodily injury or death.

On the other hand, the MV Act does not require compulsory insurance for third-party property damage. For third-party property damage coverage, an insurer’s obligations arise solely from the contractual relationship with its policyholder. The insurance contract requires its policyholder or insured driver to report the accident to the insurer.

6. What should you do if you remain unable to pursue insurance claims?

Victims of road traffic accidents who remain unable to pursue insurance claims may file a civil claim against the other party or claim compensation from their own insurer.