The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Establishing a fund to compensate Bahamian victims of ‘hit and run’ and uninsured drivers could be prohibitively expensive, insurance companies have warned, given that an estimated 25 per cent of vehicles are not ‘playing by the rules’.

Commenting on calls by Court of Appeal president, Justice Anita Allen, to create a compensation mechanism similar to the UK Motor Insurers’ Bureau, Bahamas-based property and casualty insurers said the burden of financing it would likely fall squarely on properly insured Bahamian drivers.

In essence, those complying with the law would end up paying - through increased auto insurance premiums - for the one in four drivers who are uninsured, underinsured, or have no driver’s licence.

Tom Duff, Insurance Company of the Bahamas (ICB) general manager, told Tribune Business of Justice Allen’s suggestion: “It’s certainly feasible, but the big question is who pays for that fund?

“It would have to come from the consumer through their premium, and the difficulty we have in contemplating such a fund in the Bahamas is we have a higher percentage of uninsured drivers than in the UK, where they are not such a drain on the industry.

“When someone is injured, there are so many uninsured drivers that the fund is going to be under strain unless it is properly funded, and a significant amount of funding will have to come from policyholders.”

Mr Duff added: “In practical terms, in introducing such a fund I’m not sure the judges were aware of how much it will cost the average man in the street in paying this cost.

“It’s a good idea to protect the insuring public, but in practical terms it would have to be funded properly, and that comes back to the properly insured driver who properly insures his risk.

“The gut feeling is there’s one in four drivers who may not be insured or properly insured.”

Mr Duff was backed by Patrick Ward, Bahamas First’s president and chief executive, who called for greater enforcement of the road traffic laws to combat rogue drivers.

“I think that has some merit,” Mr Ward told Tribune Business of the Court of Appeal’s compensation fund proposal.

“However, what has to be done in conjunction with that is a greater enforcement to ensure that all persons using vehicles on the road are adequately insured.

“If you do that, you take away the reason for a fund to payout in those cases. My position is that the best way to tackle this issue is to enforce the legal requirements for persons to have insurance.”

The UK’s Motor Insurers Bureau, founded in 1946, provides compensation to victims of accidents caused by uninsured and untraced drivers, and Justice Allen in a recent ruling said it mitigated “the injustice of innocent, uncompensated third parties”.

And she added: “Regrettably, we have no such fund in the Bahamas from which innocent third parties may be compensated.

“I would commend to the relevant authorities the establishment of a fund similar to the Motor Insurance Bureau in the United Kingdom, to which injured and non-compensated victims not covered by the reach of this judgment can look to for relief.”