JIS News

Debate on a Bill to amend the Motor Vehicle Insurance (Third Party Risks) Act, began in the House of Representatives, yesterday (September 27). The Bill seeks to have local insurance companies cease the practice of paying the minimum amount on Third Party motor vehicle insurance policies, and instead pay the maximum sum of the value of the policy.
In his contribution to the debate, Minister of Foreign Affairs and Foreign Trade, K.D. Knight, congratulated the Senate for not blocking the Bill, which was introduced by Opposition Senator, Arthur Williams.
“For us now to be receiving this Bill in this Chamber in the way we are doing, quite frankly, augurs well for the future, and so I want to spread congratulations around,” he said.
On the matter of the Court of Appeal’s declaration that “if insurance companies agree to insure a party to the extent of a sum in excess of the statutory minimum and collects premium based on that sum, it is unjust to require the companies to pay over to the injured party, only the minimum coverage required by the statute”, Mr. Knight said where the companies do not pay out the insured sum in its entirety, it was an act of deception.
Under normal circumstances, he explained, “statutes of this nature are not retroactive, they come into effect when the Governor General has signed and will relate only to matters that arise thereafter”.
The Minister, however, said the House should consider the likelihood of the statute being given retroactivity, and noted that such an action would not be an injustice to insurance companies as they collected premiums from insurers.
Opposition Leader, Bruce Golding registered his objection to the proposal of retroactive legislation. He said members of the Opposition were “extremely apprehensive about retroactive legislation”.”We hold a principled position on it and it is a principle that we would seek to rationalise only in very extreme circumstances,” he added.
Both sides of the House agreed that debate on the Bill should be suspended for more discussions on the subject.
When Senator Williams introduced the Bill on September 16, he remarked that the Court of Appeal had, on more than one occasion in judgments of the Court, pointed out that the interpretation of section 18 (1) of the Motor Vehicle Insurance (Third Party Risks) Act has resulted in an injustice to injured parties, and had recommended that the statute be amended to avoid this injustice.
Minister of Justice and Attorney General, Senator A.J. Nicholson, during the Senate debate, said the amendment was supported fully, because the “injustice of the situation” was seen.
“You can’t have insurance companies charging premiums and saying that you are insured for $10 million and when a judgment is given against a person who is injured by the person who that company insures, and the law says you cannot go above a statutory minimum of one million dollars, the company that has taken from the insured person all of this money over the years, says we will put that windfall in our pockets and will go no more than the statutory limit says,” Senator Nicholson had said.

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