Motor Vehicle Insurance - Return of Premiums

(Re Drake Insurance plc)

The decision of Neuberger J in Re Drake Insurance plc , August 2000, forthcoming in [2001] Lloyd’s Rep IR (forthcoming) at first sight appears to be an arid dispute as to the calculation of the amount of return premium when a motor insurer becomes insolvent. However, the side issues in the case raised important issues as to recoverability of premiums generally, as to the effect of a cancellation of a policy under the Road Traffic Act 1988 and as to the application of the Unfair Terms in Consumer Contracts Regulations 1999 to insurance policies. The case arose following an application to the court by Drake’s provisional liquidators for rulings on issues of law arising from the liquidation.