COMPULSORY INSURANCE.

Manawatu Herald, Volume XLIX, Issue 3879, 4 December 1928, Page 4

COMPULSORY INSURANCE.

EFFECT ON PREMIUMS. Motorists are puzzled concerning the precise operation of the compulsory third party insurance scheme ■which will he introduced next May (says the Auckland Herald). Insurance companies who are willing to accept the insurance at £1 a car are required to register and the motorist may nominate the company to which he desires the premium should be paid. The Postal Department will make a deduction for the cost of collection. It is expected that insurance companies issuing comprehensive policies will reduce the premium to compensate for the £1 paid for the compulsory third party policy. In the event of a company not registering for compulsory insurance the motorist holding a comprehensive policy with the firm concerned will have to nominate another company to take over his third party risk. The A.A.A. is investigating the operation of motor insurance iin this direction as it has been suggested that complications might arise if the motorist is covered by 'different companies in respect to personal injury and property damage- . , Compulsory insurance is such a new idea that there is little to be learned of its workings in other parts of the morld. According to the American Motorists’ Association, the Massachusetts insurance law in on the verge of collapse. The association, comprised of approximately a half million motorists throughout the country, has “marked time” as to whether or not compulsory automobile insurance is a good or bad thing for the motorist. Along with other similar , organisations and State legislatures the organisation has considered it wise to give the Massachusetts law—the first enacted—a chance to prove or disprove its feasibility. After twenty months of troubled operation the insurance law of that State is now facing its most critical period. Without either endorsing or disapproving the compulsory insurance idea, J. Borton Weeks, president of the association, briefly sums up as follows the present status of the Massachusetts act: “The Massachusetts law, believed by some to be nearing a collapse, is of particular interest to mo- . torists as well as the general public at. this time, since the approaching legislative season for other States , ha_s been expected to be widely productive of proposals for compulsory insurance, based more or less on the Massachusetts act. Should this law fall it will mean a serious setback to the legislative programmes in many States, while if out of the chaos a workable act can be . evolved it may prove a guiding beacon toi other legislatures.

“Three important legislative moves are now being planned in Massachusetts as a result of the latest difficulties of the Massachusetts compulsory act. 'The first of these is a bill bejng prepared by the insurance companies to repeal the compulsory insurance law. A second plan is being sponsored by the State Treasurer, providing that all reports of settlements must be filed with the Insurance Department so that they can be open to the public. The third plan advocates a State found to handle the insurance, the plan proposing that each motorist contribute £2 to £5 toward the fund when he registers bis vehicle and out of which claims are to be paid under State supervision.” In the opinion of the state officials, insurance companies, members of the bar, automobile dealers and owners as well as the public generally it may be stated generally that compulsory insurance has not yet been feasibly worked out in the state.