Reverse indemnity clauses – Can your home insurance help you make a claim?
If you wish to make a personal injury claim one of the first issues you and your solicitor will have to consider is whether or not the third party who caused your injuries has the resources to meet your claim if it is successful.
There is no point in pursuing a third party if they do not have insurance that would pay your compensation, or alternatively if the third party does not have the financial means to pay the compensation themselves.
It is no use to an individual winning a claim against the third party if they are unable to pay the compensation due.
In most cases companies will have insurance in place to meet a claim. Drivers are obliged to have motor insurance and employers must have Employer’s Liability insurance. These policies would cover road traffic accidents or accidents at work.
In other types of case, there is usually no concern about the third party having the funds to meet a claim. For example if someone is injured tripping on the pavement, the local authority will have sufficient funds to pay the compensation.
However, some unscrupulous employers or drivers may not take out insurance even though they are legally obliged to do so.
In the case of a road traffic accident caused by an uninsured driver, the injured party can still pursue a claim and obtain compensation via the Motor Insurers Bureau which exists to compensate the victims of uninsured (and untraced) drivers.
There is though no equivalent body in existence if an accident occurs that is the fault of an employer and the employer has no insurance.
In addition, some groups of people and some activities do not require insurance although they may give rise to accidents.
Cyclists, pet owners, people using certain mobility scooters (i.e. those not taxed and insured for use at higher speeds on the road) and pedestrians are not required to have insurance that would indemnify them against any claims if they (or their pet) caused an accident.
Therefore if a claim is a result of a dog bite or an accident caused by a cyclist or pedestrian or a person using a mobility scooter, the person responsible may not have any insurance to meet the claim.
If the third party in any personal injury claim does not have insurance to meet the claim then often the injured person will be advised that it is not worthwhile in pursuing a claim. However, it may be that the injured party could still be able to pursue their claim and be paid their compensation if at the time of their accident they had home insurance which had a “reverse indemnity” clause.
Many home insurance policies will have such a clause, the terms of which would apply to the injured party’s own home insurers to pay any compensation awarded to them if the third party does not pay.
In certain claims therefore where the third party is not insured, it may be useful for the injured party to provide their solicitor with a copy of their home insurance policy to see if their own insurers might be obliged to meet their claim. Taking advantage of a reverse indemnity clause may allow those injured to receive compensation when otherwise they would not have been able to pursue their claim.
It may be that there are requirements under the injured party’s home insurance policy to provide early notification of the claim to their home insurer. Therefore in any potential personal injury claim it is important for solicitors to consider whether relying on a reverse indemnity clause might be necessary at an early stage during a claim, especially where it is known or suspected that the third party does not have insurance.
A reverse indemnity clause will normally allow an injured party to be compensated by their own insurer if they bring in a type of claim that their home insurance would cover them against if they had caused an accident.
An injured party would not therefore usually be able to rely upon a reverse indemnity clause to pursue a claim whether injuries were caused by the deliberate actions of the third party, such as by a criminal attack. However, a person injured in a criminal attack will usually be able to pursue a claim for compensation via the Criminal Injuries Compensation Authority (CICA).
If you have sustained injuries in an accident and you think that the person responsible may not have insurance to meet your claim then the specialist personal injury solicitors at Quality Solicitors Oliver & Co will be happy to advise you whether you would be able to bring your claim in any event and receive payment from your own home insurers via a reverse indemnity clause.