Motor claims - protect consumer who make third party claim

Printed in Straits Times Forum page
We agree with Mr Tam Ah Hock ('Protect consumers'; Nov 10) that the insurer of an illegally modified vehicle that caused the accident should pay the third-party claim. 

After paying the claim, the insurer can seek to recover the loss from its policyholder, if the policyholder had breached its conditions. This should be a separate matter between the insurer and its insured and should not affect the third-party claimant.

The insurer is not acting fairly by refusing to consider a claim from the third party on the grounds of a breach of policy condition. It is hard for the third party to sue an uninsured owner, as the owner may not be able to pay.
The current law should be amended to extend compulsory insurance coverage to damage of third-party vehicles.

The insurer should also be required to pay compensation to third parties, regardless of a policy breach by the insured. This will protect third parties but leave the insurer free to seek recovery of the loss from its insured. 
At present, most owners buy at least third-party insurance to cover injury and property damage. The change to the law will not cause hardship to consumers.

MR TAN KIN LIAN, 
President, Financial Services Consumers Association
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