Car Insurance For The Super Rich

[hc4361]

I am sure that if you ring fence x amount of millions of pounds to pay third party claims in the event of a road accident you don't need car insurance.

I can't find anything on the web about this and would like to know what the required amount of money is.

This is in light of all the Arab owned super cars being towed in London for no insurance.

[TWR]

I'm sure the amount is £250000. but I will be corrected no doubt.

[bert_h]

That's not nearly enough. The lifetime costs of caring for a severely disabled person can be several millions.

[McMouse]

I don't know if it is still an option, but large organisations used to be able to carry their own third party risk by satisfying the authorities that they had adequate reserves to cover claims.

[ABerrant]

£500,000, as per the Road Traffic Act 1988

http://www.legislation.gov.uk/ukpga/1988/52/section/144

[hc4361]

Thank you, AbErrant, that is exactly the information I wanted.
£500,000 doesn't seem enough really, as has already been said a motor accident claim can come to millions.


If I were a super rich Arab bringing my supercar over for a few months, I'd be inclined to ringfence £500,000 to avoid paying insurance I probably wouldn't need to claim on. After all, I'd be able to afford it

[ABerrant]

Until 1991 the amount stipulated was only £15,000, a figure originally set in the Road Traffic Act 1930.

[FredPuli43]

You can insure supercars by the day; this is how auto magazines cover themselves when they take cars on the road. Any Arab prince would do that for the short time , weeks or months, that the car was here rather than deposit £500,000. Bound to be some specialist insurer who'd take the business.

[boxtops]

I'd be less concerned about the car damage, than the possibility of rendering someone quadraplegic if I caused an accident - the personal injury damages could be way over £1m, without insurance.

[hc4361]

methyl, that link gives the exception to a need for motor insurance. It is part of the Road Traffic Act and is legally binding.
If the uninsured driver proves he satisfies all the requirements of the legal exception his car will have been illegally towed.

[hc4361]

boxtops, this is about third party liabilities. If one chooses not to insure their own million pound car against theft or damage, that is their business.

[boxtops]

Absolutely, hc - which is why I'd worry about a TP liability for life-changing injuries, either to someone else or to a passenger.

[hc4361]

I haven't, methyl, and it would be interesting to find out.

That would be a super cheap way of insuring your fleet of supercars (assuming only you drive them) - zero if no accident. I dread to think how much one of those cars would cars a 20 year billionaire to insure.

[New Judge]

An important point to note with Section 144 exceptions is that the £500k has to be physically deposited with the Accountant General. The exception is not provided if the vehicle owner simply “ring fences” it or just proves that he has the cash available. Furthermore, the deposit is required per vehicle so somebody using S144 to avoid insuring “ a fleet of supercars” will face losing access to a tidy sum.

Assuming that somebody with access to huge amounts of cash will probably look to earn at least 5% p.a. on their investments, £500k will earn them £25k a year and even for the most expensive cars insurance may be a cheaper option. For that reason I do not think S144 is utilised too much. Additionally, as has been mentioned, the deposit scheme does not absolve a driver from liability and it may well be that a serious accident leaves them with a bill in excess of the half mill.

Of course the cheapest option is neither to insure the vehicle nor arrange the £500k deposit and it seems that some people are choosing to do just that.

[Zacs-Master]

In the case of causing injuries which would require millions of pounds in compensation, wouldn't a legal (civil?) case determin damages, irrespective of insurance?

[New Judge]

Yes, and the driver would be liable for all those damages regardless of his £500k lodgement.

[Zacs-Master]

Thankyou for confirming my common sense suspicions.

[Fitzer]

Pretty much the same way Lloyds used to (and possibly still does) operate, Names could lose everything if there was a run of claims against them as there were in the late '80s. They only had to buy into a syndicate with a certain amount of money up front but were liable for un-limited amounts.