A delay in the delivery of electronic motor insurance certificates could cost industry millions
A logjam in the Department for Transport could cost the insurance industry more than £10m.
In November, brokers applauded an announcement by the DfT that it would legislate the electronic delivery of motor insurance polices.
Biba, which campaigned for the change for more than two years, said the decision would create a more automated system, better customer service, the avoidance of repeat calls from customers chasing documents and better adherence to the FSA’s contract certainty requirements.
But almost five months later, there is still no word from the government on when the law will come into effect. In an email seen by Insurance Times, a government source said there is no progress to report, creating doubt that the certificates will be delivered by the summer.
Graeme Trudgill, Biba technical and corporate affairs executive, said he thinks it’s unlikely the legislation will come into effect before the end of the year.
He said: “There has been no sign of any progress or draft rules.
“There is no reason why this shouldn’t happen quickly.”
Biba said it was aware the serious delays within the ministry are caused by an overloaded legal department.
But the delay is not just bad for insurance companies and brokers, it’s an unnecessary hassle for policyholders as well.
The instant delivery of the certificates would be an advantage, particularly for people buying a new car, as it gives immediate proof of insurance without having to wait for the document to arrive in the post.
It also has environmental benefits and could lead to improved accuracy with the Motor Insurance Database (MID).
The MID—a real-time statutory record giving proof of insurance—has developed into a powerful tool with police using it regularly to check for uninsured drivers.
The DfT, like the insurance industry and the police, is obviously keen to keep uninsured drivers off the street and yet delays to this legislation will only continue to stall progress.
Biba campaigned hard for the changes initially but must now stay on the government to ensure speedy delivery of the reform.
