Practice of Motor Insurers Reducing Third-party Damages Awards to Accident Victims by Deducting Sums Paid Out from Victims' MediShield Life

Mr Low Wu Yang Andre asked the Coordinating Minister for Social Policies and Minister for Health (a) whether there is any legislation disallowing motor insurers from reducing third-party damages awarded to accident victims by deducting sums paid out by the victim's MediShield Life; (b) if not, whether the Ministry will consider introducing such legislation, and (c) whether the Ministry has data on the prevalence of such practices by insurers.

The Singapore Courts have recognised in precedent cases that insurers cannot reduce third-party damages awarded to victims by deducting sums paid out by the victim's MediShield Life policy. The Courts have taken this position based on the Insurance Exception to the rule against double recovery under the common law, which states that the injured victim's insurance claims are not deductible from damages payable by the wrongdoer. Courts in other common law countries, such as the United States and the United Kingdom, also recognise this doctrine.

There is thus already an established legal principle in place to address the concern.

The Ministry does not have data on the prevalence of the practices of motor insurers.