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Since 1951, all users of motor vehicles have been required, under the Motor Vehicles Insurance (Third Party Risks) Ordinance Cap. 272, to be insured against any liability which may be incurred in respect of the death of or bodily injury to any person caused by or arising out of the use of a motor vehicle on a road in Hong Kong.
With the rapid increase of motor vehicle ownership in Hong Kong, cases arose where the victim was unable to obtain compensation to which he was entitled because the vehicle was uninsured, or the vehicle or driver was untraceable, or there had been some material breach of insurance policy conditions by the driver or the policyholder. This clearly frustrated the intentions of the Ordinance.
The insurance industry recognised that something should be done in order to ensure that bodily injury victims of road accidents with legally enforceable claims should obtain the damages due to them. In early 1978, the Accident Insurance Association of Hong Kong started work on the formation of an organisation similar to the Motor Insurers' Bureau existing in some parts of the British Commonwealth, but adapted to suit Hong Kong. Proposals were submitted to the Government and discussions were held. By late 1979, the scheme was taking a clear shape as principles and logistics were agreed upon. On 27th June 1980, motor insurers jointly entered into a 'Principal Agreement' with the Government, agreeing to establish the Motor Insurers' Bureau of Hong Kong ("M.I.B.") within six months. This led to the incorporation of M.I.B. in December 1980, and the signing of the First Fund Agreement in February 1981, which enabled M.I.B. to carry out its objectives. |
