THIRD PARTY RISK

Dominion, Volume 24, Issue 283, 26 August 1931, Page 8

THIRD PARTY RISK

‘Hit-and-Run’ Motorists CLAIMS TO BE MET Procedure Finalised It was recently announced by the Minister of Transport, Hon. W. A. Veitch, that an arrangement had been made whereby, insurance companies would in future meet third-party claims in those cases in which the motorist responsible for the accident could not be located. Further reference to this question is made in the annual report of the Transport Department, which was presented to Parliament yesterday. “Although the Motor-Vehicles Insurance (Third-Party Risks) Act, 1928, is much more complete in its provisions for insurance of third parties injured or killed by negligent motorists than any other enactment of which the department is aware,” states the report, “the case of a third party who is injured or killed by a motorist of the ‘hit-and-run’ type is not covered by the Act unless the motorist is subsequently located. The insurance companies are not desirous'of taking advantage of this fact, and an agreement, to be signed by all of the companies accepting risks and by the Minister of Transport, has been finalised and will be gazetted, laying down the procedure to be followed to obtain compensation in such cases, proof of negligence by the motorist being, of course, an es sential ingredient in all these accidents.” A Year’s Claims. For the year ended May 31, 1930, the report states, 42 insurance concerns gave the prescribed notice to undertake business under the Act and carried on business accordingly. The premiums for the year, excluding, of course, any relating to the 1930-31 licensing year, amounted to £240,630/17/9, after taking into account adjustments between the insurance concerns and the insured on account of extra premiums and refunds due to changes in the classification of the vehicle and the cancellation of registrations. The commission of the Post and Telegraph Department, at the rate of 6d. per transaction, amounted to £5624 7/4, leaving a balance of £235,006/10/5. Claims settled during the year, including ’coSts, amounted to £84,959/18/6, while the liability in respect of outstanding claims at May 31, 1930 (including costs), was estimated by the concerns carrying on the third-party business at £97,950/8/6. Assuming that this estimated liability would eventuate, . this meant that the total payments on account of compensation (including costs, would amount to £182,910/7/-, or 77.83 per cent of the net total of premiums received. Developments Being Watched. The report emphasises that the statistics cover the period of one year only and that they must bo interpreted with the utmost caution. “It is quite impossible," it adds, “to state to what extent they represent normal or abnormal conditions. Experience over a longer period is the only way of ascertaining figures that will be typical of the thirdparty business in all' its ramifications. The developments of the scheme are being closely studied with a view to ensuring that due equilibrium is maintained between premiums and benefits, but definite conclusions cannot ba- reached until more experience has been recorded. “It is of interest to note that the percentage ratio of claims actually paid (including costs) to'premiums for all classes of insurance undertaken in accordance with the provisions of the Accident Insurance Companies Act, 1908—accident (including motor accidents), diseases, employers’ liability, etc.—was 51.75, 49.32, 54.03, 57.98, and 60.62 per cent respectively for the five calendar years ending with 1928. As the outstanding claims for any particular year would be paid during the succeeding or subsequent years, these figures are comparable, up to a point, with those for the third-party business alone, which show a corresponding percentage ratio of 77.83 per cent. Owing to the short period covered by the third-party figures, too much should not be inferred from this comparison, beyond a broad indication, that may be disproved by further experience, that the premiums as they stand to-day are not too high.’