Stopping the car insurance cheats

Police can now make on the spot checks

The number of people driving on Britain's roads without car insurance costs the industry £400m a year in claims and lost premiums, and that figure is rising. The BBC's Sarah Pennells reports.

We have more uninsured drivers on the roads in the UK than almost any country in Western Europe.

But, until now, tracing those car owners who do not take out a policy has been difficult.

That will all change with the launch of an insurance database, which will tell police whether a car is insured.

Donald Martin: paper chase costs millions

The new database will mean that a motorist stopped at the roadside by police can be checked to make sure the car is insured.

At the moment, drivers asked to produce insurance documents are allowed seven days to report to their local police station.

This is costly for the police, and inconvenient for drivers.

In future, officers will be able to call on a central database, drawing on information from all motor insurers.

Sue Hall, from technology consultants Experian, says this will allow insurance details to be verified at the roadside, allowing officers to check documentation immediately.

It is estimated that one in 20 motorists do not have car insurance.

But someone still has to pick up the bill if they have an accident.

The cost to industry of these claims is rising sharply and, ultimately, this is passed on to policy holders.

The estimate for 2001 is £265m, and experts say these costs add about £15 to £30 to every car insurance premium.

On top of this is the cost to the industry of lost premiums.

Motor Insurance Database facts & figures

1 million drivers have no insurance

Cost to industry of claims:
1995 £100m
1998 £165m
2001 £265m (est)

Number of convictions for uninsured in England & Wales: 257,000 (1998)

Average fine for driving without insurance: £150

Process costs police about £20m/year

Under motoring laws, cars must be taxed, insured and, where necessary, have passed an MOT road-worthiness examination.

Tax discs cannot be bought without presentation of an insurance certificate, but that is the only direct check on insurance details.

And the current system means the police waste millions of pounds trying to confirm details.

Donald Martin from Motor Insurance Database says, "in something like 75% of the cases where they [police] issue a form, valid insurance exists".

He says the cost of this paperwork is in excess of £20m a year.

The database will be up and running by mid-July, and the industry hopes it will result in more people taking out car insurance - and more of those who do not being caught.