The Government may have to compensate uninsured drivers in crashes where they are found not to be at fault if a European Commission challenge against the State succeeds.
The Commission is contesting the State's refusal to pay compensation to a blameless driver in a crash where all involved have no insurance. The action has been prompted by a complaint from Dundalk solicitors representing a man left as a paraplegic after a collision in which both drivers were uninsured.
"In the Commission's view, the Irish rule is contrary to the principles contained in the Second Motor Insurance Directive," said the Commission. Under this directive, compensation must include the victims of accidents caused by unidentified or uninsured vehicles.
In Ireland, insured motorists who are involved in collisions with uninsured drivers can claim compensation from the Motor Insurers Bureau of Ireland (MIBI). It operates a fund generated by a levy from all motor insurance firms. However, uninsured drivers, regardless of culpability, can not claim. Driving without insurance has been a crime since 1933.
The solicitors who lodged the complaint with the Commission are confident the State's stance is wrong and the "test case" will succeed. "We act for a motorcyclist who was hit by his brother who was also on a motorbike," said solicitor Joe Traynor. "The brother we act for is paraplegic after the crash although our view is the other party was at fault." His firm is handling a number of similar cases.
He admitted the severity of his client's injuries had led to the decision to take the case. The complaint was lodged with the Commission last year based on legal advice from senior counsel.
"Our view is that the MIBI was set up to compensate victims of uninsured drivers," said Traynor. "We are making the case that this person is entitled to compensation, that the purpose of the MIBI was to ensure he was compensated in a situation where another party is at fault."
The State is likely to oppose the case strongly. John Casey, chief executive of the MIBI which is jointly responding to the complaint with the Department of Transport, said: "Our position is when two uninsured drivers collide we will not compensate either, irrespective of culability. We believe this is fair and reasonable and there is a strong legal basis for it."
Casey said that, while a decision on how to respond would be formulated with the Department, the six per cent of motorists who drive without insurance are a "serious issue" to the MIBI.
"Last year payments made by us to victims of uninsured and untraced driving amounted to €50 million. It's a colossal amount of money. We paid out €50 million or thereabouts in each of the past four years to innocent victims of these irresponsible people." The MIBI handles about 2,000 claims a year, but the number is declining.
The Irish Insurance Federation estimates that paying for this adds roughly 6 per cent to insurance premiums.
Casey said that, even if the case succeeds, it will not greatly increase the cost of claims to the MIBI as "the number of uninsured drivers colliding is mercifully quite small".
He stressed that possible financial implications were not the issue. "It appears to be wholly inequitable that the uninsured driver, who did not cause a particular accident would be eligible for compensation given that he or she has not bothered to insure and is quite outside the law."
If the State decides to contest the complaint, the issue is likely to be referred to the European Court of Justice.
