insurance
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by John Vann, FCII
The unexpected risk
• Road Traffic Act third party cover is a that the user of a vehicle on the road has t have. Such cover relates to third part personal injury only. This means that th vehicle user does not have to insure agains claims for damage to other people's property.
In practice, the minimum insurance h looked upon as full third party cover, givim the driver unlimited cover should any claim I) made against him for injury to somebody els: or damage to property of a third party. This i the position under a car policy.
But there is an important difference when i comes to a commercial vehicle policy, a under this contract a limit applies in respect c damage to any third party property. Sofro years ago, the limit was generally £50,000 However, modern policies are much mon advanced and the limit has been raised ti £250,000 with most insurance companies.
"But surely £50,000 indemnity i. sufficient, isn't it?" This was a question fron one operator recently. In the vast majority a cases £50,000 is more than adequate, as fev claims—even for personal injury—reach sucl a figure.
Yet it's the exception to the normal that ha: to be guarded against. Recently, I earn across a claim for around El m. It was i simple affair really—at least, to begin with. ) petrol tanker driver was merely reversing hi: vehicle into a factory building. But somethim went wrong. The ghastly result was a gutter factory, production stopped for many month: and the death of several people.
Agreed, such an event is exceptional. Bu take the lorry which overturned on a bend ir the country a few years back. This lorry wal carrying a highly poisonous liquid. Its tanl fractured. The load spilled out into a field an sank into the ground. There was a massive underground reservoir beneath this spo providing water for nearby cities.
Although it didn't, just suppose the poisor had seeped through into the reservoir 'tt contaminate all the water in it. It might havf taken decades for the reservoir to clear itself And think of the costI Indeed, the cost of sod damage could have approached that building an entirely new reservoir.
Dangerous loads can, in themselves produce their own special problems. What mean is that the vehicle itself need not be involved in an accident for trouble to arise There was, for instance, an explosion some time back in the load of chemicals carried by 4 lorry. This drew attention to the possibility a damage or injury which is not caused by the use of the vehicle itself.
It's doubtful whether any claim which might arise from such an explosion would be covered by the lorry policy. And a genera public liability policy might well exclude such an event. The surest way of avoiding a gap ir cover is to place both insurances with the same office and ensure that one or other a the policies does include this kind of risk.