Motorists using private vehicles to transport paying passengers could be placing themselves and their passengers at serious financial risk.
The warning has come from chief executive officer of CG United Randy Graham, who said insurers will not respond if those vehicles are involved in accidents.
The Alliance Owners of Public Transport (AOPT) has called for urgent action to address what it says is a growing problem of illegal operators on Barbados’ roads. It has raised concerns about an increase in unlicensed vehicles transporting passengers for hire, particularly along the ABC Highway and Speightstown routes, arguing that the practice threatens passenger safety and undermines legitimate public service vehicle operators (PSVs).
Graham, a former president of the General Insurance Association of Barbados, told the Sunday Sun the situation was “very worrying”. He said many motorists might not fully understand the consequences of using privatelyinsured vehicles for commercial passenger transportation. “We are on record of warning our clients against using vehicles in that way. If you have a private vehicle and you are registered with the Licensing Authority as a private vehicle and you have an insurance policy as a private vehicle, your insurance policy does not cover any fee-paying passengers. It specifically asks whether you’re using the vehicle for fee-paying passengers,” he explained.
Risk profile
Graham said that carrying passengers for payment fundamentally changes the risk profile of a vehicle and requires a different type of insurance coverage.
“If you’re using a private vehicle for fee-paying passengers, the passengers in that vehicle are not covered for liability in that regard. You would need to get a separate commercial insurance policy that covers passenger liability, which is not the same as a private vehicle policy.
“So if people are taking a private car and using it to carry passengers, then the insurance policy will not kick in and pay liability for any passengers injured.”
He warned that drivers who use their private vehicles for commercial purposes without informing their insurers could find themselves facing cancellation of their policies.
“The insurance company is probably within its rights to ask you to change the policy or cancel your private policy and require you to take out a different policy if you want to use the vehicle in that way, because that’s not how the policy responds. It’s a dangerous and worrying situation and we beg people not to do it. Get the proper licence and the proper policy or use the vehicle as a private vehicle,” Graham suggested.
The insurance executive added that policyholders had a responsibility to accurately disclose how their vehicles were being used.
“The policy can be cancelled. It can be cancelled from the beginning for material non-disclosure, but the policy itself reserves the right to cancel because it is being used in a different way from what was declared on the form.”
Potential impact
He said the greatest concern was the potential impact on passengers who might unknowingly travel in vehicles not properly licensed or insured for commercial operations.
“They shouldn’t do it because honestly, it’s a risk to them and to the passengers. If they get in an accident and the passengers are injured and the policy doesn’t cover those injuries, then the owners and drivers of the vehicle are the ones who have to pay for the passenger injuries. If they don’t have the funds to pay for it, then the injured passengers are the ones who suffer,” he stated.
He called on the public to think carefully.
“We urge passengers, if the vehicle is not properly registered, to contemplate whether they want to use that vehicle or use a properly registered commercial vehicle. If you get in an accident and you’re injured and the vehicle is not properly registered or doesn’t carry the right insurance, then you could be at risk of not getting your injuries paid as well. You’ve got to be careful.”
While noting that CG United had not encountered such incidents, Graham acknowledged that the practice existed.
“We know that it happens. We haven’t seen it with our clients because we tend to be very strong in educating our clients and making sure they don’t do it. We’ve heard there are instances that have occurred elsewhere, but certainly we are very strong in educating our clients not to do it because it’s a dangerous practice,” he said. (TRY)
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