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New Van Insurance Regulations Explained
The government has introduced a new set of van insurance regulations which mean that it has become illegal to own a vehicle which is not covered by a sufficient insurance policy. This regulation came into effect on the 20th June 2011.
It is hoped that this will help to address the problem of uninsured drivers in the country, with research by moneysupermarket.com suggesting that one in six drivers are currently without adequate insurance cover.
We therefore take a look at this new regulation in order to determine the impact it will have and what changes you will have to make.
The new regulations
Continuous Insurance Enforcement (CIE) regulations mean that it is now illegal to own a van, car, bike, truck or motor home which is not covered by a relevant insurance policy. The laws are very similar to the regulations which are currently in place for road tax, with vehicle owners now needing to have insurance cover in place at all times.
CIE has become possible thanks to a new relationship which has been established between the DVLA and the Motor Insurers Bureau (MIB), with the latter providing the DVLA with access to their Motor Insurance Database. This contains a list of vehicle registration plate numbers of every vehicle which is covered by a relevant insurance policy in the UK.
Possible penalties
Police will use special cameras, similar to those that are used for road tax, to compare vehicle registration plate numbers against those that are held in the Motor Insurance Database. If a vehicle is not featured on the list, then police will immediately issue a £100 on the spot fine and be given a time frame within which they must arrange for the required insurance cover.
Failure to comply with this notice could result in an additional £1,000 fine, a possible court appearance and also face the prospect of having their vehicle clamped, seized or destroyed.
The only exception
Vehicles which have been declared off the road to the DVLA by a SORN (Statutory off Road Notification) are the only vehicles which are omitted from the new CIE regulations.
A vehicle can be declared off road to the DVLA by filling in a form online, over the phone or by posting a copy of the sheet which can be obtained from your nearest post office to the DVLA. For contact details and further information visit the direct.gov.uk website
Reasons behind CIE
CIE is not just another government profit making venture aimed at motorists, as it is actually aimed to saving drivers money. The government has been growing increasingly concerned about rising insurance prices in the past couple of years, with the average driver paying 40% for their premiums in 2010 compared to 2009 according to the AA.
It has therefore been decided that uninsured drivers should be tackled, with the Motor Insurers Bureau (MIB) believing that they are costing the UK insurance industry £500 million each year. This has been calculated by looking at the income insurers have lost from the targeted segment and the costs they have had to cover when ever an uninsured driver has been involved in an accident.
The additional expenditure and lost income is ultimately being passed onto law abiding motorists in the form of higher basic insurance costs, with £30 being added to every premium according to the MIB. It is therefore hoped that CIE will help to address this developing problem and ensure that van insurance remains affordable. CIE is a victory for all law abiding motorists.