Legislating Need for Motorists to Report Traffic Accidents to Their Insurers

Madam, in the last three years, the Monetary Authority of Singapore (MAS) and the Land Transport Authority (LTA) have received 12 complaints and one complaint respectively, from insured parties about the counterparty failing to file an accident report with their insurer after being involved in a road accident.

The General Insurance Association of Singapore (GIA)'s Motor Claims Framework (MCF) sets out the procedures for all accidents to be reported to the insurer within 24 hours or by the next working day, which is incorporated as a condition of all motor insurance policies. The procedure is not, however, mandated legislatively.

Notwithstanding the above, under the Motor Vehicle (Third Party Risks and Compensation) Act, an insurer cannot refuse liability on the ground that the policyholder has not reported the accident. I repeat: an insurer cannot refuse liability on the grounds that the policyholder has not reported the accident if the third-party's claim is for bodily injury or death. Victims of road traffic accidents who remain unable to pursue insurance claims can file a civil claim against the counterparty or claim compensation from their own insurer.

The Ministry of Transport (MOT), LTA and MAS will work with other relevant Government agencies and GIA to review and, if necessary, strengthen the requirements for reporting road traffic accidents to insurers.

I thank the Minister for his reply. The reason why I raised this question was because recently, at a Meet-the-People Session (MPS), a resident approached me for help on this matter. Obviously, he had gotten involved in an accident. I do not believe that there was any personal injury case, but there was obviously damage to the vehicle. He was actually told at the time that nothing could be done if the counterparty failed to file an accident report with his insurance company and, therefore, the only action he could take was a civil suit.

But obviously, as you know, going to Court and all of that can be stressful. It is time consuming and also, even though it might be the Small Claims Tribunal, it is intimidating and it can also be costly in a way. I am just wondering whether there is anything else that can be done even though we note that only 12 complaints were received about this; whether there is anything else that can be done to prevent this from happening.

Again, I do not know if the Ministry has any further data about how widespread this problem is because it might be that no official complaints were filed and this practice has been done. There was also an article to the Forum page recently about this matter. So, obviously, this is happening, and I am just wondering what else can be done to assist the motorists who actually find themselves in this unfortunate situation.

Madam, I thank the Member for her question. If I may layer my response, first, as the Member has observed herself, at least insofar as the number of complaints are concerned, it is a relatively small number, which suggests that, by and large, motorists do report these incidents, and it is partly because the incentive is there for them to do so; because if they do not, and if it were to come to pass that their insurer discovers this and it is a violation of the contractual condition, then there is a risk of losing the insurance contract.

Secondly, a civil suit is obviously one solution and remedy available. There is a spectrum of other options available to the aggrieved party. This includes, of course, claiming from their own insurer which I know is not necessarily an ideal outcome, but it does address the substantial financial loss. However, it does mean that the no-claim bonus and so on might be affected in that regard.

Amongst the GIA, there is a facility where such cases are referred to. And where the cases are assessed to be meritorious, there is also compensation available in that regard.

Finally, to reiterate the point that I made earlier, we will study this further with MAS and with the industry and others to see if there is a need for further tightening in this regard to safeguard the interests of motorists, as the Member has highlighted.

Thank you, Mdm Deputy Speaker. I thank the Minister for his reply. I also have a resident who is in the same predicament. I think the larger issue here is that if there is no viable means right now to take the culprit to task, what kind of message are we sending out to motorists that they can simply get away with something like this and not be responsible if they do not report it?

So, my question is: if the victim has got the personal particulars or NRIC number of the person who is the culprit, can we submit that detail to LTA for their assistance to put some pressure on the person? Because, rightfully, LTA is in charge of the licence of the vehicle that this person is driving. So, is there some assistance that we can get from LTA regarding these matters?

Mdm Deputy Speaker, I thank the Member for her suggestion. I appreciate the spirit and intent of her suggestion, but we do have to bear in mind a couple of things in this regard.

The first is that these matters are never undisputed. Usually, there is an element of dispute. So, ex ante, there is no case that just because one party has the details of the other party, it means the other party is the offender or the "culprit" – in the words of Member. So, any action taken by any Government organisation in terms of investigation or follow-up has to be meritorious, has to be on the basis that there are facts disclosed that point to that.

Having said that, the key point here is, first, the incentives are actually there, by and large, for motorists to make such reports in compliance with their contract; because if the insurers were to find that they did not make such a report and subsequently, there are claims made and there is a set of issues, then for the party concerned, the risk is that they stand to lose their insurance cover and, without insurance cover, you cannot drive a vehicle on the roads according to our laws. So, that is a significant thing.

Secondly, as I have said, we will see if there is scope to do anything further by way of mandate or requirements. But again, ultimately, no matter what the mandatory requirements are, the system functions best when all parties concerned are aware of their obligations under the law and fulfil those obligations.