THIRD PARTY RISK

Evening Post, Volume CXVI, Issue 24, 29 January 1934, Page 11

THIRD PARTY RISK

COMPULSORY INSURANCE OPPOSED

NEW ZEALAND EXAMPLE

(From "Tho Post's" Representative.)

SYDNEY, January 25.

Following a proposal by tho Vie-.J torian Government to introduce a measure providing for compulsory third party insurance by motorists, New Zealand ha 3 been given more than a fair share of publicity. It is because, of the New Zealand example that the companies are bitterly opposing the new measure. When the liogan (Labour) Government was in power the idea of compulsory insurance was mooted, but, in the face of subsequent opposition, it was dropped. The matter lias not yet been decided by the present Cabinet, but in the meantime the companies are putting in a great deal of propaganda work. The general manager of a prominent firm of insurance brokers, who considers that his views aro indicative of the feeling throughout the insurance business, said that 'tho experience of New Zealand had shown the foolishness of compelling drivers to insure for third party risks. In ■ New Zealand accidents had increased enormously since the introduction, ho said. Insurance companies were compelled to issue a policy to any driver, however negligent he was, or how indifferent his ability. The system had also resulted in a large number of false claims by people who deliberately declared they had been injured by motorists. In addition, extraordinary claims wore made to the Court because, the claimants knew that it was the insurance company that was paying. ; ', And, for the same, reason, juries gave extravagant awards. The methods, adopted in the United States provided another reason why Victoria should not adopt the compulsory system. The State of Massachusetts forced its drivers to insure, but 18 other States Sid not. They had learned • -their ■ lesson from Massachusetts, and had enforced a financial responsibility law. That meant that a driver, once his licence had beerf suspended indefinitely, or over whom there had been a. final judgment establishing negligence, could not drive again until he had guaranteed up to £2000 for death, or personal injury through accident. The cry for compulsory insurance had come from tho hospitals, but surely there was Some other way of satisfying the demands of the hospitals without penalising the insurance companies.