A 14-week government consultation is currently underway to determine whether the current definition of a 'vehicle', in line with the Road Traffic Act, (RTA) should be extended.
The consultation, Motor insurance: consideration of the 'Vnuk judgment', which is also relevant to the farming community, will question whether vehicles driven solely on private property need to be insured and could result in owners of these previously 'unregistered' vehicles having to take out mandatory motor insurance cover.
As many farmers will own vehicles that are not (or are rarely) used on the public highway but rather on private farm land, the consultation outcome could influence their insurance liabilities should an incident involving a non-registered vehicle occur.
Foreign Secretary Boris Johnson was yesterday critical of the proposals in an article for the Daily Telegraph. However, by citing what he called a 'kiddie quad bike insurance law' Mr Johnson risks dismissing some real issues that the consultation seeks to address. Even if it may appear heavy handed on the surface, encouraging too liberal an attitude to the potential risks that can be associated with use of certain types of heavy and specialist vehicles that are used on many a working farm (which can often interlink with areas of public access) is surely misguided.
Ahead of the end of the consultation period in March ERS considers what any change in policy could mean for farmers.
BACKGROUND
The current consultation follows a ruling in the European Court of Justice (ECJ) in 2015 in the case of Damijan Vnuk.
Vnuk was a Slovenian farm worker who was injured as a result of being knocked off of a ladder by a tractor/trailer. The accident occurred on a private farm and the vehicle was manoeuvring in the farm yard.
Vnuk made a claim against the farmer's motor policy but the claim was denied as the cover did not extend to vehicle use away from a public highway.
However, the claim was pursued and ultimately heard in the European Court of Justice. The ECJ ruled that Article 3 of the First EU Motor Insurance Directive required:
- that insurance is required in respect of the normal function of a motor vehicle
- a tractor being manoeuvred within a farm is within the definition of the normal function of a motor vehicle
- such requirement applies regardless of where the vehicle is being used
- such requirement applies to all forms of self-propelled motor vehicle (this is simply defined as any motor vehicle other than one designed to travel on rails)
Therefore Vnuk was entitled to be compensated for injuries that he sustained as a result of this accident.
CURRENT SITUATION
Under current UK legislation compulsory motor insurance applies only to those motor vehicles being used on the public highway or other public place as defined by the Road Traffic Act.
At present some farmers will look to the employers or public liability sections of their general farm policies to provide cover for non-registered vehicles whilst these vehicles are being used. However in light of the Vnuk ruling this may pose potential problems should a farmer, or other farm vehicle user, inadvertently drive into an area covered under the Road Traffic Act (RTA) - such as crossing a road from one field to another or entering part of the farm where there is public access – and then find that following an accident that their public liability insurer may refuse indemnity if the RTA is deemed to apply
GUIDANCE FOR FARMERS
If Vnuk is embraced in full then farmers will need to take fresh stock of their liability exposures regarding any non-registered vehicles they are using and seek professional advice from a broker to help them understand any additional cover requirements.
However, even if the proposals are not embraced in full the Vnuk case means that future interpretations of cover may be influenced by the ruling that triggered the Department for Transport's move to consult and future injury claims where vehicle use is interpreted as being subject to RTA.
Regardless of the consultation outcome, ERS believes that post Vnuk farmers need to be mindful of any potential gaps in cover and speak to their insurance broker about what the use of non-registered vehicles on public highways (even if unintentional) means as refusal of indemnity by an insurer of employers or public liability risks may leave the farmer exposed to deal with potential cost of a personal injury claims themselves.
