Ensure you're insured

Suddenly, this peaceful journey is interrupted by a loud crash, and everyone is forcefully shunted forwards as another driver hits you from behind.

Dazed by what's just happened, you pull over into a safe place where insurance details can be swapped.

But panic sets in as you realise that instead of following, the other driver has simply vanished back into the flow of traffic, never to be seen again.

So what happens next in this tale? Well I should know, because it happened to me.

It was the first chapter in how a motorist recoups their losses if they are the victim of a "hit and run" smash or the other driver is uninsured.

Drivers with no insurance or who can't be traced are a menace to all law-abiding road users.

Not only do they push up the costs for all motorists by adding to the premiums that everyone pays, but they injure some 26,500 people every year and kill around 130.

If you find yourself in a situation like this, don't delay in telling the police as well as your insurer.

Try to get down as much evidence as possible, including descriptions of the other vehicle and its occupants and names and contact details of any witnesses.

Photos may also help, which is where a mobile phone camera could prove useful.

You're also likely to end up needing the help of a body called the Motor Insurers' Bureau (MIB), which acts as a financial safety net for innocent motorists.

The MIB was set up in 1946 as a not-for-profit body funded by the insurance industry, and ultimately the insurance policies of all drivers.

Under an agreement with the UK Government, the MIB acts as a lifeline for innocent motorists when the perpetrators are uninsured or can't be traced.

Paul Ryman-Tubb, head of technical at the MIB, explains: "Our role is to pick up the claim when there is no one else to pay."

Just like making a more normal claim where the driver who caused the accident is insured, the MIB will consider detriment such as personal injury, damage to property and loss of earnings.

Mr Ryman-Tubb said: "We will deal with all of this and compensate you, provided we accept that the uninsured driver is at fault."

The compensation process is likely to take a similar length of time for victims as if the other party involved was insured, although it can take longer if there are aspects which need further investigation, such as a dispute over who owns the other vehicle.

But the MIB's provision of compensation for victims doesn't mean uninsured drivers simply get off the hook.

Not only can they face fines, points on their licence and possible disqualification, but the MIB will pursue uninsured drivers, through the courts if necessary, to claw back the financial losses they have caused.

The MIB also plays a vital role in preventing cases like these happening in the first place.

It works with bodies including the police, the DVLA and the government to take uninsured drivers off the road.

One big change came from a new power handed to police in 2005, enabling them to seize uninsured vehicles.

The MIB provides the police with information extracted from the Motor Insurance Database (MID) of 38 million policy records to have this at their fingertips.

Almost 2,000 vehicles are now seized like this every week, many of which end up being sold or crushed if the owner can't prove they have insurance.

Meanwhile, 15,000 letters a week are being sent out to people suspected of keeping a vehicle without insurance.

These initiatives have helped to dramatically cut the number of uninsured vehicles on the road, from around two million in the early 2000s to one million now.

In a further reflection of the success of these clampdowns, the number of claims the MIB receives from victims of such accidents has also almost halved, from about 38,000 in 2005 to just over 22,000 last year.

The crash in which I was involved happened some time ago.

With my incident having been investigated and resolved, I've seen an end to my own personal saga, to my great relief.

And with more motorists who flout the law being stopped in their tracks, it's also reassuring to know that the chances of being hit by an uninsured driver are diminishing for everyone.

WHO DRIVES UNINSURED?

Drivers with no insurance often have a string of previous motoring offences to their name for bad behaviour such as speeding or jumping red lights.

They may never even have passed a driving test.

Often, it is young men who are caught driving without any insurance.

Young drivers tend to face higher premiums than those with more experience under their belts, in part because they are statistically much more likely than the population generally to be involved in a crash.

"In fact, around a third of young drivers will have some kind of collision within the first 12 months of passing their test," says Ian Crowder, a spokesman for AA Insurance.

Despite the common profile of uninsured drivers, they can come from all walks of life and age ranges.

Mr Crowder says one recent case involved a boss who forgot to insure his new car, while another involved a single mum who needed transport but said she couldn't afford her insurance.

Sometimes, an uninsured driver can be the unwitting victim of a "ghost broker".

This is a fraudster who sets up a false insurance policy, often for a young driver looking for a "cheap" deal or someone who does not speak fluent English.

Motorists can check that their vehicle is on the Motor Insurance Database at www.askmid.com

POUNDNOTES

Financial dictionary: MyLicence

This soon-to-be-available initiative will enable the motor insurance market to compile a more accurate picture of someone's driving history when they apply for a policy.

The move aims to cut fraud and ensure premiums reflect correct driving records.

People searching for car insurance quotes may be asked to provide their 16-character driving licence number.

This will then be matched against the DVLA's records.

The move will typically save honest customers an estimated £15 on the cost of their car insurance.

:: MONEY WORRIES 'CAUSE 11 NIGHTS' SLEEP LOSS A YEAR'

Nearly one in seven Britons lies awake in bed at night worrying about money, a debt charity has found.

Those whose sleep patterns are being disrupted are typically losing 11 nights' worth of sleep a year, according to the findings by StepChange Debt Charity.

Some 15 per cent of more than 2,000 adults surveyed for StepChange said that being plagued by late-night thoughts of their financial difficulties is preventing them from sleeping properly.

:: INVESTORS ENCOURAGED TO GO FOR GOLD

More people are being encouraged to take the plunge and become gold investors by a new bullion trading website launched by the Royal Mint.

The new website allows consumers to buy bullion coins struck in gold or silver directly from the Mint as well as being able to sell coins back if they wish to.

The royalmintbullion.com website constantly updates live prices for gold and silver at a rate linked to the current precious metal price.

:: CRICKET CLUB LAUNCHES RETAIL BOND

Lancashire County Cricket Club has announced the launch of its first retail bond.

Cricket fans and investors would need to lock their money away for five years and have a minimum of £1,000 to invest.

In return, the bond offers five per cent interest paid in cash and a further two per cent in vouchers which can be redeemed against the club's international and domestic tickets and hospitality products, including food and beverage packages and also membership fees.

The club aims to raise £3m to help fund development of a new four-star branded hotel to replace the existing Old Trafford Lodge.

HIGH FIVE SAVERS

:: Phone/Website Rate Account Period Deposit Interest Paid

Secure Trust Bank www.securetrustbank.com 3.52%(F) FixedRate 31.08.21(B) £1,000 Yly

Vanquis Bank www.highyieldaccount.co.uk 3.21%(F) High Yield 5YrBnd(W) £1,000 Yly

United Bank UK 0800 218 2266 3.20%(F) FixedDeposit 5YrBnd £2,000 Yly

Tesco Bank 0845 678 5678 3.20%(F) FixedRate 5YrBnd(H) £2,000 Yly

Coventry BS Via branch 2.00% Branch Instant ISA Instant £1 Yly

TOP FIVE MORTGAGE RATES

:: Phone No Rate Period Max% Adv Fee Incentive

Norwich&Peterborough BS 0845 300 2522 1.89%F For 2Yrs 65% £195 Yes

Norwich&Peterborough BS 0845 300 2522 3.54%F For2Yrs 90% £195 Yes

Yorkshire BS 0845 120 0874 2.89%F to 31.10.19 65% £975 Yes

Yorkshire BS 0845 120 0874 4.24%F to 31.10.19 90% £975 Yes

Post Office 0800 077 8033 4.95%F to 31.8.16 95% - Yes

Code:

* - Introductory rate for a limited period F - Fixed H - Operated by internet or telephone K - Operated by internet, telephone or post B - Operated by post or telephone W - Operated by internet P - Operated by post D - Discounted rate V - Variable rate

:: Source: Moneyfacts moneyfacts.co.uk. 01603 476 476 (All rates subject to change without notice)