Motor insurance: direct actions against insurers
Section 152(2) of the Road Traffic Act 1988 allows an
insurer to seek a declaration that it is has the right to avoid a motor policy
for material non-disclosure or misrepresentation. The circumstances in which
avoidance is available have been severely restricted by the Consumer Insurance
(Disclosure and Representations) Act 2012 (for consumers) and the Insurance Act
2015 (for businesses), but fraud or recklessness suffices in both cases.
Similarly, if theinsurers can show that they would not have accepted the risk on any terms or at
any premium, there is a right to avoid. However, it is clear that the right to
seek a declaration is not compatible with EU. That was confirmed once more in
 EWHC 781 (QB).
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