Motor insurance

Conditions limiting the use of a motor vehicle

The Road Traffic Act 1988 is designed to ensure that the victim of a negligent driver can recover from the driver’s insurers. To that end, a wide range of policy exclusions are prohibited by s148 of the Act. However, the Act does not go as far as banning all restrictions on coverage. The scheme of the Act is to allow the victim, once he has obtained judgment against the assured, to enforce that judgment against the insurers (s151 of the 1988 Act). However, if the insurers have a valid defence under the policy, the victim must instead seek compensation from the fallback source, the Motor Insurers’ Bureau. The scope of permitted exclusions was considered by the Court of Appeal in Keeley v Pashen [2004] EWCA Civ 1491, [2005] Lloyd’s Rep IR (forthcoming).