Insurance Law Monthly

Section 151 of the Road Traffic Act 1988 provides a mechanism whereby the victim of an insured driver can enforce a judgment for personal injury or property damage against the driver’s insurers. By reason of extensions in accordance with EU, enshrined in section 151, the insurers are liable to indemnify the victim even though the driver was not insured to drive the vehicle, although in that event the insurers have a right of recourse against the driver under section 151(8).

Farrell v Whitty Case C-413/15 was a reference to the Court of Justice of the European Union from the Irish courts, arising out of the long-running proceedings brought in Ireland by Ms Elaine Farrell for injuries sustained by her in a motor vehicle accident. Although the case is concerned only with the position in Ireland, it has immediate and important consequences for the Motor Insurers' Bureau in England.

The decision of the New South Wales Supreme Court in Amashaw Pty Ltd v Marketform Managing Agency Ltd [2017] NSWSC 612 makes a number of points on the coverage of liability policies for property damage. Few authorities were cited, but the conclusions reached by the court are fully consistent with English law and provide interesting illustrations on the issues of law that can arise in property liability cases.

The decision of Gendall J in Young v Tower Insurance Ltd [2016] NZHC 2956 marks a significant departure in the common law. Although the case is primarily about the measure of indemnity under a property policy, the New Zealand High Court has now specifically adopted an implied term of utmost good faith, one aspect of which is the obligation of an insurer to handle a claim properly and without delay.