Recently as the Insurance Ombudsman, I shared my views through this newspaper about ‘private’ vehicles insured for personal use being ‘hired’ or ‘rented’. I explained why insurance companies will not be liable for any accident occurring during the hire or the rental.
My article prompted several readers to ask questions about liability for damages to vehicles while (i) being parked at hotels and (ii) while at a repair or service garage.
Regrettably, for owners of such vehicles (the insured), the legal position is that the insurance company is not liable unless that particular policy had additionally covered such risks. The normal policy has no such cover. In such cases, you must look for relief to the hotel or repair garage where the damage occurred.
To explain in greater detail, if you go to a hotel or holiday resort to stay as a guest and the hotel undertakes for the parking of your vehicle, the hotel will be liable for any accidental or wilful damage to your vehicle while it is at the hotel. Your own insurer will not be liable directly to you for such damage. Most hotels take out Public Liability Insurance covers which normally include insurance cover for their car parks and the insurer giving such policies will then be responsible through the hotel to you. This is the same type of Public Liability cover that protects the hotel from any injury caused to a guest/visitor within the hotel such as tripping and falling on the floor and injuring himself or herself. Notices saying ‘Caution, wet floor’ will only reduce the damages claimable but cannot avoid liability.
Thus, as far as paying guests are concerned, the hotel or resort is liable for bodily injuries caused or damage to the parked motor vehicles of such guests. For this protection hotels normally takes out insurance cover. Now, what about those who attend functions, weddings and receptions at hotel and park their cars in the Hotel car park or get valet parking? What is
the position if your car that was parked was damaged? For example, another person who had used the car park had knocked into your car and driven off without notifying anyone and the hotel security had not seen it (except that it may have been captured on the surveillance cameras). In the above illustration, can you claim against your own insurer? The answer is no. The claim if any must be against the hotel. Many hotels include in the Public Liability Insurance Covers they take, accidental damage to vehicles in their car parks.
If the hotel has taken such cover they will claim under it and pay for your damages caused within the hotel. If not, obtaining relief for the damage suffered will be a problem. Hotels also put up notices saying ‘Parking is at your own risk’. Many do not take these notices seriously but such notices are legally valid and do exclude liability – although as a gesture of goodwill and good public relations hotels will grant some relief to vehicles damaged within their premises. After all, they employ security and it is their business to protect vehicles parked or at least apprehend the party who caused the damage so that such person can be made responsible.
So much for car parks and parking at hotels. What about damage caused to your vehicles while at a Motor Repair Garage to which you have given your vehicle for servicing or repairs? As the Insurance Ombudsman I have known a case where an employee of a garage after an argument with the garage owner (his own boss) wilfully smashed up the windscreens of several cars that had come there for servicing! In another case, while a car was on a hoist, the hoist collapsed with the car on the hoist falling down and in the process several other vehicles in the garage were damaged. Another instance was where another person who came to get his vehicle repaired badly knocked into a parked vehicle when he was driving out.
In all the above cases, one of wilful damage and the other two accidental damage, can you claim from your own insurer if you have a comprehensive motor cover. The answer is clear: you cannot. There are decided judicial decisions supporting this answer.
So what must be done? My advice is not to give or leave your car for repairs at a garage that will not accept any liability for damage caused to the vehicle while at the garage. Like hoteliers, garage owners can take out Public Liability Insurance Covers which will cover them for any damage caused to a vehicle they have accepted for repairs or service. Some of them do not do so. Many of them are unaware of such insurance cover.
Shopping Plazas like Liberty Plaza and Majestic City also take out Public Liability Cover. For instance, if a shopper is accidentally injured while within the public area of the Shopping Plaza such injuries are covered by such insurance policy. Sometime back as the Insurance Ombudsman I decided on compensation in a case where a lady shopper had slipped on a grape and injured her ankle. In another instance a shopper (a senior executive in a leading corporation) was badly injured by falling in an unprotected and unlit area of the shopping plaza’s car park. The insurer agreed to pay the medical and hospitalisation costs of the injury.