Five Questions About: Continuous insurance enforcement

Car insurance rules are changing – why?

New rules take effect next month to tackle the problem of uninsured drivers. One of the reasons car insurance premiums have risen so much over the last few years is because of the increasing number of people driving without insurance. Research from moneysupermarket.com found that one in six motorists have driven without insurance and this is affecting the amount other drivers have to pay for insurance. Uninsured drivers cost the industry £500m a year. Covering the cost of accidents involving an uninsured driver adds an average £30 to the cost of a car insurance policy, according to the Motor Insurers' Bureau.

So what's changing?

From 20 June, a new law called Continuous Insurance Enforcement will make it illegal to own a vehicle without it being insured. Car and motorbike owners without insurance will be given a £100 fine and if their vehicle remains uninsured they face court action and a further fine of up to £1,000.

Who else will be affected?

You face a fine if you forget to take out insurance or have a vehicle such as a convertible or motorbike that you currently insure for just part of the year.

Are there any exemptions?

Vehicles registered with the DVLA as having been declared off the road. A SORN (Statutory Off Road Notification) declaration must have been completed.

Is there anything I should do differently?

Car insurance is already a legal requirement but the new law means you can't afford to let your cover lapse and you must have insurance in place from the day your existing policy ends. Reinsuring with your existing insurer may seem like the simplest option but it's unlikely to be the cheapest. Your existing insurer should send a renewal quote a month before your policy ends giving you plenty of time to shop around and find the right cover at the best price.