Vnuk – constructive solutions to minimise claims risks

I thought Alistair Kinley made a very valid point, in his earlier article of 13 August, calling for constructive solutions to the Vnuk problem. There needs to be a balance drawn between the protection of victims of accidents arising out of motor vehicles and the potential scope, post-Vnuk, of compulsory third party motor insurance (TPMI). Notably, TPMI will be required to cover use of vehicles, off-road, that may result in a contrived or potentially unworkable insurance solution.

Motorsport is an obvious example. At present, motorsport events that occur off-road are not subject to TPMI. Authorised motorsports events are licensed by the sport’s governing body through permits that extends public liability (PL) and personal accident cover for participants and event organisers. However this PL cover does not cover driver-to-driver liability. With this PL risk, post-Vnuk, potentially transferring over to a TPMI risk, not only does this give rise to some interesting liability questions, such as, how does one assess liability in a driver-to-driver collision when racing, but also fundamentally, with unquantified exposure, will there will be any appetite from motor insurers to underwrite the sport in the first instance?

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