The Motor Insurers' Bureau and the police are keen to avoid any mishaps with the introduction of automatic number plate recognition technology. Ed Vinales reports
The Motor Insurers' Bureau and police are bracing themselves for the introduction of automatic number plate recognition technology - the latest tool to be launched in the fight against uninsured driving. Despite police warnings that there will be "hell to pay" if things go wrong, however, (PM, 6 October, Fraud Management Briefing, p7), there is still a degree of uncertainty on both sides, not least regarding information transfer.
On 4 November, a new law was introduced allowing the police to extract insurance data from the Motor Insurance Database. To avoid a repeat of the road-tax debacle, which saw the police using information that was months out of date, there will be an initial two-month trial limited to Sussex and Bedfordshire police forces.
Ashton West, chief executive of the MIB, says: "We have already successfully tested the mechanism for transferring the data from the motor insurance database to the police's ANPR technology. The two-month trial is a precautionary measure before we roll out the scheme to the rest of the UK."
Accuracy of information transfer
The MIB is taking police warnings regarding the effective running of the ANPR technology seriously. Mr West says the insurance industry is ready for the trial to commence but concedes the time period could be extended.
On the issue of accuracy of information transfer and associated time limits, Penny Coombs, of the Motor Insurers' Information Centre, which runs the database, says: "The target for updating the MID is 14 days and we are aiming for 95% accuracy. We will also be giving the police a list of vehicles that came off insurance a certain time ago because the MID is not updated immediately."
Inspector Ian Bond, the Association of Chief Police Officers' assistant ANPR co-ordinator for England and Wales, admits the system is in its infancy: "Currently insurers have no submission time limits. However, once we have achieved the required accuracy, the system will be rolled out nationally. We believe this will make the roads safer by taking cars away from uninsured drivers."
Paul Geden, technical liaison manager of Highway Insurance, says: "The majority of people buy everything needed to legally drive a car. What they don't realise is that their premiums are raised to cover the costs of people who are hit by uninsured drivers. They need to be aware of this fact."
The issue of data transfer is fundamental to the successful implementation of the new law but it seems that there is a lot of work to be done on both sides. Allan Briscoe, chairman of the British Insurance Brokers' Association's motor panel, highlights the difficulty in getting policyholders to comply with insurers over the submission of insurance details. "We are working with software houses and insurers to improve response time. These issues were raised in the MIIC and Association of British Insurers' working parties and relate to the electronic data interchange transfer system between intermediaries and insurers."
Mr West explains that it is easier for direct underwriters to comply with submission deadlines because the information can go straight from the point of sale to insurers' back-office systems. When commercial insurance intermediaries are supplying data about complex fleet risks, however, transfer speed is naturally impeded.
Roger Ball, commercial motor manager for Allianz Cornhill, explains: "Motor fleets are not captured down to the identity of individual vehicle information. The industry has been trying to improve that detail of information during the past few years but clients are still not used to giving that kind of information."
Barry Smith, chief executive of Fortis and chairman of the ABI's motor committee, points out that Professor Greenaway's research into uninsured driving found that personal insurance was at the heart of the problem - not commercial insurance. And, according to Ian Roberts, detective inspector in charge of traffic and ANPR intelligence for the Metropolitan Police, the officer who made the "hell to pay" comment regarding insurers' information submissions to the MID last month, fleet insurance will not be targeted by the new crackdown.
Mr Ball warns, however, that the database is only as effective as the people that use it. He is well aware of the pressures facing the insurance industry in monitoring the transfer of information. "Ultimately, the police have to secure prosecutions," he says.
He is concerned that, despite a maximum £5000 fine for driving an uninsured vehicle, most offenders still receive fines that equate to less than their annual premium would be.
Mr Geden says that because magistrates' decisions are means-tested there is no way around this issue, but adds: "When the Road Safety Bill comes into force there will be enough enforcement out there to drive down the level of uninsured driving."
The ANPR law is just the latest in a series of new motor legislation and follows July's introduction of the Serious Organised Crimes Act, which gave police the power to seize and crush uninsured vehicles.
According to DI Roberts, these powers have already been put to good effect: "We have seized more than 300 cars and crushed 50."
Other uninsured driving concerns held by insurers relate to driving-other-cars policies, which the police would like to see expunged from policy wording. Norwich Union Direct has already dropped DOC cover but not all insurers agree this is necessary.
Mr West says: "DOC cover is abused by the public. People will buy a cheap car with DOC cover and then drive their other more expensive vehicles with the third-party insurance it provides. People need to be educated and informed that DOC is designed for emergencies."
Mr Briscoe adds that the police believe removing DOC cover will mean there is no way of cheating the system. "There needs to be a uniformity and clarification on what DOC cover means."
Another area in which NU is taking something of a lead is in pay-as-you-drive deals. Tim Rankin, managing director of claims management specialist WNS, says this scheme looks at one of the root causes of uninsured driving.
"If you have a low income and a low annual mileage but live in London, your premium is probably high so this deal gives people less of an excuse not to buy insurance."
Mr Geden believes ideas such as this are probably the future for motor insurance. "Ultimately, it is about treating customers fairly and helping them to understand the insurance they buy."
CURRENT AND PLANNED LEGISLATION
The Road Safety Bill is currently going through the House of Lords and will then progress to the House of Commons. The earliest time it is expected to become law is March 2006.
The Serious Organised Crimes Act, legislation giving police power to seize and crush uninsured vehicles, came into force on 6 July this year.
From 4 November, police have had the power to extract uninsured vehicle data from the Motor Insurance Database for use with automatic number plate recognition technology. The initial trial of the system is limited to Sussex and Bedfordshire police forces.
Post Magazine's annual motor claims conference is being held on 23 February 2006. To book your place at this conference and to find out more contact: Emilie Martin on 0207 968 4619 or [email protected]
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