A guy was too busy to send his car to his usual franchise service workshop to service his car. The workshop has a door to door delivery service and arranged a driver to pick up the car for the service. Unfortunately, on his way to the workshop, the car met with an accident.
This case may have been deliberated in the forum before but I would like to hear comments from members as to whether the insurer of the car can deny liability citing the vehicle was used for Motor Trade purpose at the material time of the accident. The door to door delivery service was provided free of charge. Would it make any difference on the issue of liability had a service charged been proposed and accepted by the owner for the service?
Comments
Raymond Huang Many motor workshops provide door-to-door service foc on the condition the driver was driving the car for the purpose of the insured and not for the workshop. In such a scenario, the car would be used not for motor trade but for social, domestic and pleasure purposes. Where a service charge was made, the car would then be driven for the purpose of the motor trade and the use excluded by the insured's private car policy. The loss would come under a Motor Trade policy held by the workshop.
Yam Lim Song RH, I am on the same page as you. Let us hear from others. If you use the same scenario to a valet parking business which accepts a fee for parking your car and is driving with your permission, the insurer of the car is still liable for any accident caused by the valet parking attendant. Why? Is it because valet parking is not regarded as a business associated with Motor Trade?
Richard Foong Firstly, is the driver authorised by the insured. If yes, the policy will respond. Secondly, was the car driven for reliability trial, hill climbing tests or is being tested in preparation for any motor sports competition? If no, the policy cannot disclaim liability. Thirdly, is there any agreement signed between owner and workshop. If yes the policy can deny liability as it does not cover any liability assumed by agreement.
In the case before us, the motor policy have to respond for the damages to the car. The motor trade policy will not come into play unless it is driven with trade plate.
- Richard Foong To arrange a trade plate policy, firstly jpj must grant the approval for the trade plate registration number. Insurers will never insure them if no approval given. May be Public Liability policy with come into play provided it have the clause Property held in custody, control and in trust of ........
Hope it is correct.
- Raymond Huang YLS - I differ from you on valet parking. Our policy excludes use for any purpose in connection with the Motor Trade. Is valet parking considered use for motor trade purpose? I think so. The UK motor policy makes special provision for valet parking at hotels and restaurants - as there is no such provision in our policy, I conclude that valet parking is deemed use for the motor trade and not covered. RF - There are two types of motor trade cover - plate or named driver. PL policy must never be extended to cover ACT cover under the RTA. A private car policy will never cover use for motor trade even if the driver is authorised to drive the car by the insured - you should reassess your position viz-a-viz the Limitation as to Use in the C/I/
- Richard Foong There is no hard and fast rules to make the claim. FOC and with fees, both drivers have to be authorised by the owner. The only difference is whether any agreement been signed by the owner to pay for the fees. If yes, it become a sticky situation. However, workshop are too smart as they will teach owner on how to report the accident and insurers may not know of its arrangement unless some one inform them. The motor policy of the insured would have to bear the loss.
- Yam Lim Song RH, if valet or jockey parking is considered a form of Motor Trade, then you are perfectly correct. Agents should from this study to advise their clients of the risk of valet or jockey parking without a trade plate. Your point about not to extend PL policy to cover ACT cover under RTA is absolutely right. However, I know in most PL policies issued to major hotel chain, the policy is extended to cover Car Park and valet parking liability risks. Have we ever seen a Trade Plate on a car driven by hotel valet driver?
- Richard Foong Firstly, who employ the valet or jockey? If hotel, there is a vicarious liability involved. However it is outsourced, the pl policy must have the clause on contractors and sub contractors. PL policy also cover TPBI if it happen within the hotel premises unless itsits territorial limit is within Malaysia. In hotel, no trade plate been given as trade plate is use solely on the road from point A to point B. The question is when the insured hand the key to the valet, will the insured be exonerated from liability should an accident happen? The damage to the car may be claim under the hotel PL policy if the policy have the clause 'Property held in custody, control or in trust..... ' then they will pay for the damages. The only complication may arise if it is outsourced and no policy cover them, then the insured have to bring the hotel in as a third party to the proceeding. Hope it answered, YLS.
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