Oh No; I Forgot to Renew my Drivers Licence!

Oh No; I Forgot to Renew my Drivers Licence!

By Ross Lee
14 January 2009

While the law understands that anyone drink driving is not physically able to control a vehicle properly – an insurance policy may be equally void because the driver was not the holder of a current licence.

Even though it is legal to purchase a chainsaw (a potentially lethal power tool) and operate it unlicensed, in this country the law requires motorists to hold a drivers licence.  Many of us have heard of a motor vehicle insurance policy being voided due to drink driving. However, by operation of the contract of insurance, a perfectly fine driver, driving unlicensed may also disqualify an insurance claim.

Terms and Conditions
There are different conditions for when it is the insured themselves driving, compared with someone else – if another person is driving and the insured did not and could not reasonably have known the driver was unlicensed, there may not be a problem.

However, presuming it is you the insured driving, there are still various circumstances which may arise.  Were you unlicensed due to: being an unaccompanied learner, accumulation of demerit points, prior drink driving / dangerous driving / driving in connection with another criminal offence, or did you just let your licence expire?  Any circumstance of driving unlicensed is an offence and may incur a penalty of imprisonment and/or a fine.

Forgetting to Renew
There is a fairly common view that if you are not licensed because you forgot to renew your drivers licence, then there should still be car insurance cover.  However, that distinction is often not made when referring to exclusion clauses in the insurance policy in a typical Product Disclosure Statement.

Indeed there is no such distinction made in the “prescribed cover” standard under the Insurance Contracts Act.  So even if such an exclusion is not brought to your attention before taking out the policy, there still may be no claim.

At the end of the day, it may fall upon yourself to ask for special discretion with your claims manager for an ex gratia (“out of grace”) payment if you are a particularly good customer.  However, whether any such discretion would be applied, is not for us to say!

Health Check
On the topic of licensing, also watch out for new medical conditions which may affect your ability to control a vehicle – in your state it may now be law for motorists to report such facts to government agencies (Queensland Transport, RTA, VicRoads and so on) immediately, rather than at licence renewal.  So if you are avoiding renewal because you’re dreading an eyesight test, you won’t be doing yourself any favours!


Related Links

This article was written by Ross Lee, insurance lawyer and General Manager of the Insurance Hub – a leading insurance information website for buying, claiming and dispute resolution on car insurance, home insurance, and small business insurance.

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Can you insure your car for 6 months?

Most Australian insurers won’t offer you a 6-month car insurance policy, so you may need to buy a policy that covers your car for damages and cancel it after six months. You will need to purchase comprehensive car insurance to protect your car from accidental damage, theft, vandalism, or natural disasters.. 

Consider checking whether your 6-month comprehensive car insurance will cost more if you pay monthly or six-monthly premiums instead of a one-time annual premium. Another question to ask the insurer is whether you’ll need to pay administration or cancellation fees when you cancel the policy.

Alternatively, you can look for a suitable ‘pay as you drive’ car insurance policy, which usually offers you the coverage of a comprehensive car insurance policy but only requires you to pay for the distance driven. Such a policy may not be the ideal 6-month car insurance plan as it is based on how much you drive rather than for how long. If you need to drive a lot, you may end up paying more than you’d pay for regular car insurance. 

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A car insurance policy that covers the theft of your car, such as third party fire and theft insurance, usually covers a stolen car, even if the keys were in the car’s ignition.

However, your insurer may deny the claim if you live in an area where there have been several car robberies reported recently. They will see you leaving the keys in the car as a case of negligence. In such cases, your insurance provider may even expect you to have installed anti-theft security measures in your car. 

You may need to confirm whether or not you left your keys in your car, and if they had been stolen or misplaced, before filing your car insurance claim. The loss or theft of your car keys may be covered by a comprehensive car insurance policy, but usually as an optional item.

If you can confirm that your car keys were stolen, mention this in your claim as this will help establish that your car was not stolen as a result of your negligence.