Motor Vehicles

The enactment of the Garages Licensing Act 2022 (the “GLA”) resulted in eight different types of garage licenses and created a legislative obligation for all motor vehicles garages to be licensed in order to legally operate.

Section 3(1) of the GLA affords the Director of the Transportation Control Department (“TCD”) to grant any of the following types of licenses:

A Dealer Garage Licence for the service of motor vehicles, except cycles, at a motor vehicle dealership;
A Garage License for the service of motor vehicles;
A Cycle Dealer Garage Licence for the service of cycles at a cycle dealership;
A Cycle Garage License for the service of cycles;
A Body and Paint Garage License for the making or repairing, painting or modification of the body of motor vehicles.
A Detailing Garage License for the cleaning or modification of motor vehicles, including tinting and fabrication of identification plates.

It is important to note that a commercial enterprise may apply for more than one type of license. The motor vehicle garage licensing process under the GLA expressly states:

The renewal process for each type of motor vehicle garage license (section 4 of the GLA);
When the Director of TCD may refuse a license application (section 5 of the GLA);
That the Director of TCD must provide each applicant a notice in writing of their decision to grant or refuse a license application (section 6 of the GLA)
That the duration for each motor vehicle garage license shall be valid for up to 1 year (section 8 of the GLA);
Express reasons as to why a motor vehicle garage license may be revoked (section 12 of the GLA); and
Express reasons as to why a motor vehicle garage license may be suspended or varied (section 13 of the GLA)

Appreciating the legislative obligation for motor vehicle garages to obtain a valid license from the Director of TCD, the GLA places an obligation on the Director of TCD to maintain a publicly available register of all licensed motor vehicle garages.

Section 11 of the GLA states that the Director of TCD shall publish a register known as the “Register of Garages” in the Gazette as soon as reasonably practicable after the 1^st of January each year, and the Register of Garages must set out:

The name of each licensed motor vehicle garage;
The physical address of each licensed motor vehicle garage; and
The type of each license granted to each licensed motor vehicle garage.

As a consumer seeking to obtain the services of a motor vehicle services and repairs provider, prior to entering into a service agreement with a motor vehicle garage confirm that the prospective service provider has been formally licensed and is legally authorized to operate in accordance with the GLA.

Section 10 of the GLA obligates all licensed motor vehicle garages to: (i) have their license on public display at the address shown on their license; and (ii) to have their license be readily seen upon entry to the premises. Any licensed motor vehicle garage that fails to display their license is considered to be operating in direct violation of the GLA.

Appreciating that a motor vehicle garage may attempt to produce a fraudulent license or may be unwilling to publicly display or provide a copy of their license upon request, Consumer Affairs further recommends consumers to confirm that the prospective service provider is licensed to operate by reviewing the Register of Garages.

Furthermore, sections 18 and 19 of the GLA grants the Director of the Transportation Control Department (“TCD”) the authority to: (i) enter a garage with the intention of conducting an inspection and if necessary; and (ii) impose a “Stop Order”.

Section 20 of the GLA expressly considers the commercial impact a “Stop Order” may have on a motor vehicle garage acting in contravention of the GLA, what happens if a “Stop Order” is not complied with and how a motor vehicle garage may appeal a “Stop Order". A "Stop Order" effectively restricts the unlicensed motor garage from operating until they complete the license application process and or listed on the Register of Garages.

Section 27 of the GLA obligates the Director of TCD to maintain a publicly available register known as the “Register of Automotive Service Technicians” which shall contain the names of person’s who:

Have applied to be placed on the Register of Automotive Service Technicians; and
Have been granted a certificate.

Much like the Register of Garages, the Register of Automotive Service Technicians must be published in the Gazette as soon as reasonably practicable after the 1^stof January each year, and the Register of Garages must:

List the names of the registered automotive service technicians; and
Not contain the name of any person who is suspended in accordance with section 29 of the GLA.

Section 29 of the GLA grants the Director of TCD the authority to suspend a registered automotive service technician where it is determined that the registered automotive service technician:

Is not, while practicing the trade of automotive service technician, performing work in a manner compatible with good practice in that trade; or
Is not, and has not for a substantial period, been practicing the trade of automotive service technician.

A registered automotive service technician who, on receiving a notice of suspension, refuses or fails to surrender their certificate to the Director within seven days of receiving the notice is considered to have acted in contravention of the GLA (section 29(5) of the GLA).

Any person who is not a registered automotive service technician or, or has been suspended and portrays themselves as being a registered automotive service technician, is considered to have committed an offense.

Having previously discussed the necessity to confirm that a motor vehicle garage is actively licensed (see above), Consumer Affairs advises consumers to request the licensed motor vehicle garage to confirm who will be the registered automotive service technician performing work on their motor vehicle.

Upon receiving confirmation of the automotive service technician that will be working on your motor vehicle, Consumer Affairs advises consumers to then confirm the service technician is in fact a registered automotive service technician by requesting the registered motor vehicle garage to provide a copy of their registered automotive service technician’ certificate.

Whether the prospective motor vehicle garage provides you with a copy of the registered automotive service technician certificate, or refuses to provide such documentation, Consumer Affairs advises consumers to confirm that the automotive service technician is actively registered on the Register of Automotive Service Technicians.

If the service technician is not registered, and the motor garage does not have any alternative registered service technicians, Consumer Affairs advises consumers to: (i) refrain from using the services of the motor garage; and (ii) obtain the services of an alternative registered motor garage with certified service technicians.

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Under Bermuda’s consumer protection legislative framework, if you buy a second-hand motor vehicle from an individual and not a business, your legal rights as a consumer are limited following the purchase of the used motor vehicle.

If you discover there is something wrong with the used motor vehicle after you have purchased it from the personal seller (e.g. the motor vehicle has an incorrect mileage reading or the boat engine keeps breaking down), you will not likely have a legal right to:

(i) Repairs;

(ii) Reimbursement for the cost of repairs; and/or

(iii) Some/all of the sales proceeds from the seller.

Consumer Affairs advises consumers to exercise caution when purchasing a used motor vehicle from a person and not a business (i.e. mechanic, car dealership, etc.) as the legal principle of "caveat emptor" (i.e. buyer beware) is strictly applied in such circumstances.

Consumer Affairs cannot understate the importance of consumers ensuring that they are given an opportunity to conduct a thorough inspection of the used motor vehicle prior to completing the purchase. A fully comprehensive inspection will ensure that you are fully informed before completing the purchase (i.e. that the motor vehicle is free from defects and is “fit for purpose”).

To assist in your purchase of a used motor vehicle, Consumer Affairs advises consumers to complete the four steps listed below to in order to avoid buying a motor vehicle that is damaged, stolen or has been illegally altered.

When buying a used motor vehicle, consider the depreciated value of the used motor vehicle and compare the depreciated value of the used motor vehicle against the seller’s asking price.

Depreciation is the reduction of value of an asset over time; due in particular to wear and tear. The depreciation of a new car or bike during the first 12 months of its useful life will typically be between 15-35% of the motor vehicle’s sales price.

Appreciating that a number of factors will determine the rate of depreciation for a used motor vehicle, as a general rule of thumb a motor vehicle will experience the following depreciation schedule:

Year 1: 15-35% depreciation; 65-85% of the original value
Year 3: 40-60% depreciation; 40-65% of the original value
Year 5: 60-70% depreciation; 30-40% of the original value
Year 8-10: 80% depreciation; 20% of the original value.

The depreciation rate for a motor vehicle is not straight-line depreciation (i.e. evenly spread over the course of the life of the motor vehicle) and is instead front loaded. The majority of a motor vehicle’s depreciation occurs within the first three years of the motor vehicle’s useful life (i.e. 40-60% of the motor vehicle’s depreciation has occurred).

Exercise caution when considering the purchase of older vehicles; especially those that are over 10 years old. The older the motor vehicle is the less reliable it will likely be, and the more likely consumers will experience issues when repairs are required (e.g. finding replacement parts, more frequent maintenance than newer cars).

If you are looking at buying an older car it is recommended that you do your research of the used motor vehicle, familiarize yourself with the risks of purchase (i.e. the availability of replacement parts of qualified service technicians) and establish a true value of the car.

In addition to considering the depreciated value of the used motor vehicle (i.e. sales prices and depreciated value due to age and wear and tear), Consumer Affairs advises consumers to also consider the insured value of the used motor vehicle in order to determine the true market value of the used motor vehicle.

Although the motor vehicle may have been actively maintained over the course of its useful life and appears to be in good condition (i.e. minimal depreciation and wear and tear), this does not automatically mean that the insured value will be:

(i) The price the seller paid for the motor vehicle; and

(ii) Is worth what the seller is asking for.

If the seller of the used motor vehicle is unwilling to confirm the insured value of the motor vehicle, Consumer Affairs advises that you contact your insurance company and request an estimate for the insured value of the used motor vehicle.

In order to do so you will need to provide your insurance company with the make/model of the motor vehicle, age, mileage and repair history. Although such a service may come at a fee, by doing so you will have a more accurate idea of the used motor vehicle’s fair market value.

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After confirming that a seller of a used motor vehicle has clear legal title, completed a physical inspection of the motor vehicle, reviewed the motor vehicle’s maintenance history and accounted for depreciation and its insurer value, Consumer Affairs advises consumers to use these results to influence their negotiations with the seller.

Depending on the results of the motor vehicle assessment, the seller’s requested sales price may exceed fair market value. Consider the seller’s requested sales price as negotiable and do not be afraid to propose a sales price that is reflective of fair market value.

Sellers are often keen for a quick sale (i.e. leaving the island, must sell their existing motor vehicle prior to purchasing a new one, etc.) and in such circumstances are more likely to be open to negotiations in order to advance the sale quickly.

For example, under Bermuda law consumers are restricted with regards to the number of cars that they may have per household (i.e. one car per each assessment number assigned to the residential household). Oftentimes in order for a seller to buy a new car they must first dispose of their old car.

When entering negotiations with the seller remain calm and do not feel pressured to agree to a sales price that exceeds what you think is above fair market value or is above what you can afford. As a buyer you have the power to stop negotiations if you feel like you are being pressured by the seller.

When negotiating with the seller you will want to consider the following:

The physical appearance of the used motor vehicle (look and condition/depreciation of the motor vehicle);
The mechanical performance of the motor vehicle;

The motor vehicles service and maintenance history;
The accident history of the motor vehicle (i.e. the seller’s insurance claims history and/or maintenance history following accidents and damages caused by other parties)
The motor vehicle’s on-going operating costs (i.e. dry/wet dock storage, annual replacement of tint on windows and lights, etc.);
The motor vehicle’s mileage;
The motor vehicle’s safety ratings;
A third-party mechanic’s assessment of the used motor vehicle;
The motor vehicles market value with respect to depreciation;
How long has the seller been marketing the sale of the car (i.e. have they advertised the used motor vehicle in the local paper for a week already, or had it available online for a month)?

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If you have arrived at a mutually agreed sales prices with the seller of a used motor vehicle, the next step to consider is method of payment. As part of the payment process consumers will have to consider whether they will be able to facilitate the purchase with their existing savings (i.e. pay in cash or electronic transfer) or through external financing options (i.e. personal loan from a friend or financial institution).

There are advantages associated with paying for a used motor vehicle through existing personal savings. By paying for a used motor vehicle with your personal savings you will not be subjected to any extra administrative fees or interest charges that you would otherwise have to pay if you borrowed the money from a lender. Additionally, given the potential urgency a seller of a used motor vehicle may face as part of your negotiations you may be able to agree to a sales discount if you pay in cash.

If you decide to purchase a motor vehicle through a cash transaction facilitated via personal savings, Consumer Affairs advises that you request the seller to produce a physical and/or electronic invoice indicating the completion of the sale. The invoice provided by the seller needs to include the following information:

A clear and accurate description of the used motor vehicle purchased;
The time and date in which the motor vehicle was purchased from the buyer;
The amount of money paid to complete the purchase of the used motor vehicle; and
The signatures of both the buyer and the seller.

In addition to requesting the seller to provide an invoice, Consumer Affairs advises consumers to keep the original invoice and provide the seller with the copy in the event that the seller failed to produce a copy of the invoice for themselves. Once you are provided with the original invoice, Consumer Affairs advises that you keep the invoice in a safe and secure location.

If you are uncomfortable with the risks associated with carrying large amounts of cash on you, you may want to consider the benefits associated with utilizing an electronic transfer to facilitate the purchase. In addition to being physically safer, by paying via an electronic transfer you will be able to rely on your bank statement as a proof of purchase (i.e. a substitute for a physical invoice that would otherwise be provided by the seller).

If you decide to pay for a used motor vehicle via an electronic transfer, Consumer Affairs advises consumers to:

Include a clear and accurate description of the purchase of the motor vehicle in the electronic transfer description; and
Keep a copy of the associated monthly bank statement indicating the electronic transfer in a safe and secure location.

In order to successfully complete an electronic transfer, Consumer Affairs recommends that you first contact your personal financial service provider (i.e. bank) and confirm whether you have any limits on the amount of money that you can transfer directly to someone else’s account.

In order to complete the purchase of a used motor vehicle you may have to request to have any currently imposed limits lifted as your financial service provider has likely imposed these limits to ensure that your personal finances are secure. Please remain mindful that electronic transfers are often subject to administrative fees.

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Although there is increased consumer security when purchasing a new motor vehicle (i.e. brand new with no prior accident history, manufacturer warranty, etc.). there may be circumstances where a consumer experiences issues with the new motor vehicle shortly after completing the purchase.

‍The most common consumer issues experienced with new motor vehicles include, but are not limited to:

Broken or damaged fixtures and fittings of the motor vehicle;
The motor vehicle becoming completely unusable and is unfit for purpose (i.e. a “lemon”);

The motor vehicle fails to meet the sales description; and
The motor vehicle and/or its ancillary parts become subject to a product recall (i.e. brake pads, air bags, etc.).

If you experience issues with a new motor vehicle, review the terms and conditions of the sales agreement with the motor vehicle dealership and confirm whether you have a valid warranty and its period of validity.

The sales agreement provided by the motor vehicle dealership will likely include a warranty that: (i) covers the cost of repairs and replacement of parts and the body of the motor vehicle and/or (ii) cover circumstances where the replacement of motor vehicle is warranted. However, many warranties include restrictions that hinder a consumer’s ability to rely on it, including but not limited to:

Availability for a limited period of time (i.e. 3-5 years after the date of purchase);
Scope of service limitations (i.e. replacement and installation of parts directly attributable to a manufacturer fault); and
Service provider restrictions (i.e. service maintenance must be completed by a certified mechanic employed by the motor vehicle dealership).

Depending on the timing of the issue (i.e. within 3-5 years of purchasing the new car), and the nature of the issue (i.e. faulty part is directly contributable to a manufacturer fault, product recall), you may be able to rely on your warranty and have the costs of repair covered by the dealership.

However, given the likely restrictions embedded throughout the warranty, there may be circumstances where you will not be able to rely on a warranty for repairs. After a warranty period has expired you will be unable to rely on the dealership’s warranty. If the warranty period has expired and are directly responsible for the fault or damage to the new motor vehicle, you will be unable to rely on the warranty (i.e. you have gotten into an accident or misused the motor vehicle for its intended purpose).

Alternatively, if you knew about the fault before you completed the purchase (i.e. the motor vehicle did match the agreed sales description), and decided to move forward with the purchase anyway, you will not likely be able to rely on the warranty.

Furthermore, if you acted outside of the terms and conditions specified in the warranty (i.e. service repairs performed by an unauthorized mechanic, used an ancillary cycle for off-road purposes) your actions may render the warranty void.

When purchasing a new motor vehicle from a dealership, Consumer Affairs advises consumers to ask a customer service representative about:

The availability of a warranty;
The associated fees in obtaining a warranty; and
The key restrictions and limitations imposed under the warranty (i.e. time period of the warranty, the services covered and the restrictions of the warranty).

Following the purchase of a new motor vehicle, Consumer Affairs recommends that you remain familiar with the terms and conditions of the warranty. Consumer Affairs cannot overstate the value of knowing when and to what extent you may rely on your warranty and how your actions may impact your ability to rely on the warranty and/or render the warranty void.

If your motor vehicle dealership does not acknowledge your reliance on a valid warranty (i.e. they dismiss your claim as they are of the view that your claim lacks merit or is fraudulent), it is advised that you file a complaint against your motor vehicle dealership.

Under the Consumer Protection Act 1999 consumers are afforded legal protection in circumstances where it can be proven that they have been subjected to an “unfair trade practice”. Unfair trade practices are defined as false or misleading representations to consumers about products and services.

If your purchase of a new motor vehicle was dependent on the availability of a warranty, and your car dealership does not honor the warranty, it may be argued that the act of including the warranty as part of the purchase amounts to a “false or misleading representation” by the motor vehicle dealership.

If your motor vehicle dealership does not offer a warranty, section 14 of the Sale of Goods (Amendment) Act 2002 provides consumers with an implied warranty when one is not offered. If your motor vehicle dealership does not provide a warranty, and you experience manufacturer issues shortly after you have purchased the new motor vehicle (i.e. within 6 months) it is advised that you file a complaint against your motor vehicle dealership as soon as possible as your ability to rely on the Sales of Good (Amendment) Act 2002 will weaken with the passage of time.

If your motor vehicle dealership does not adequately resolve your formal complaint within a reasonable period of time, or refuses to acknowledge the merits of your complaint, it is advised that you submit a formal complaint with Consumer Affairs. If you require further guidance on how to file a complaint to your motor vehicle dealership, please refer to the Consumer Affairs guidance on how to submit a formal complaint.

In addition to familiarizing yourself with the terms and conditions of your new motor vehicle warranty, familiarize yourself with the owner’s manual. By understanding the contents of the owner’s manual many of the issues experienced with new motor vehicles can be pro-actively addressed through the active maintenance and proper use of the motor vehicle during and outside of the warranty period.

Although all motor vehicles are subject to depreciation and “wear and tear”, certain types of imported cars are considered “too large” for Bermuda’s smaller, windy roads, and the speed limits imposed. Being unable to be used as intended (i.e. shift through the full range of gears and RPMs), motor vehicles with oversized engine capacity require more frequent maintenance services and more frequently require replacement parts.

To avoid the purchase of a motor vehicle which may incur high maintenance costs, Consumer Affairs recommends consumers to consider:

Whether the motor vehicle is appropriate for Bermuda and its roads;
Whether such a purchase may expose you to added maintenance expenses; and
Whether you can afford the added maintenance expenses over the course of owning the motor vehicle.

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Consumer Affair appreciates that during the course of owning a motor vehicle you may:

Find yourself in a single motor vehicle accident;
Find yourself being the victim of a multiple motor vehicle accident; or
Find yourself responsible for having caused a multiple motor vehicle accident.

Depending on whether the fault of the accident was yours or of another party, and the state of your personal financial circumstances, if you desire to have your damaged motor vehicle repaired you will likely have to consider whether it is worthwhile to:

Make a claim against your own insurance policy;
Pay for the cost of repairs from your personal savings;
Make a claim against the insurance policy held by the other party responsible for the accident and associated damages; and/or
Pursue legal proceedings against the other party responsible for the accident in the event they did not hold valid motor vehicle insurance at the time of the accident.

If you do not wish to rely on your personal savings to cover the costs of repairs, it may be worthwhile to consider submitting an insurance claim with your insurance provider or the insurance provider of the party responsible for causing the accident.

If you find yourself in single vehicle accident and you wish to have your damaged motor vehicle repaired, if you make a claim against your own insurance policy this will result in an increase in your annual insurance premiums. Depending on the anticipated increase in your annual insurance premium it may make more fiscal sense to use your personal savings to repair your motor vehicle.

If you are hesitant on using your personal finances or submitting an insurance claim with your insurance provider, confirm whether you have a valid motor vehicle warranty and review the terms of the conditions. It is possible that your warranty may cover the cost of the damages and avoid you having to face increased insurance premiums as a result of submitting an insurance claim.

If you are in a multiple vehicle accident and the other party is responsible for the harm caused, it will be worthwhile to submit a claim against the other party’s motor vehicle insurance policy. However, if the other party responsible for the accident does not have valid motor vehicle insurance you may have to pursue legal proceedings in order to recover the cost of repairs. If you are forced to pursue legal proceedings, include the cost of legal fees (i.e. the cost of your lawyer) as part of your claim in the event you obtain the services of a lawyer to represent your matter.

If you intend on making an insurance claim (i.e. either against your own insurance policy or the insurance policy of the other party responsible for the accident), the insurer will likely want to send someone to inspect the vehicle(s) involved in the accident before repairs are performed in order to conduct an assessment of costs to repair.

Following the filing of an insurance claim, most of the time the insurer will cover most, if not all of the costs or repairs. If you request the mechanic to conduct additional work (i.e. repairs or maintenance not directly attributable to the damages caused by the accident) you will have to pay for the additional repairs.

However, if the estimated cost to repairs exceeds the fair market value of the motor vehicle prior to the accident, it is possible that the insurance provider that received the insurance claim may seek to enter into a settlement arrangement instead (i.e. provide the monetary value of the motor vehicle).

Upon completion of the insurer’s inspection of the damaged vehicle(s), if the insurer considers it worthwhile to commence with repair work the insurer may ask you to use a motor garage approved by the insurer. Failure to satisfy this requirement may hinder your ability to receive an insurance payout from the insurer.

If following their inspection the insurer decides that it is not economical to repair your vehicle the insurer will likely offer you the vehicle's fair market value. If you agree to receive the fair market value of the motor vehicle the insurer will normally then take the motor vehicle from you; this is known as an insurance write off.

If you find yourself responsible for a single motor vehicle accident and the cost of repairs are minor, you may want to consider using your personal savings to have your motor vehicle repaired and avoid having your annual insurance premium increase as a result of submitting an insurance claim.

Depending on the age and condition of your motor vehicle prior to the accident, it is possible that your insurer will not provide enough compensation to cover the purchase of a brand-new car and will instead elect to cover the cost of repairs. However, in this circumstance the cost of the repairs and the ensuring increase in your annual insurance premium may exceed the value of the motor vehicle.

Instead of incurring repair costs for an old, depreciating asset it may be worthwhile to attempt to sell the old motor vehicle with a disclosure to potential buyers that the motor vehicle requires repairs, and then apply the sales proceeds towards the purchase of a new or secondhand replacement.

If you find yourself responsible for a multiple motor vehicle accident, and the costs of repairing your own motor vehicle are minor, you may want to consider using your personal savings to have your own motor vehicle repaired and instruct the other party to file an insurance claim with your insurer to cover the costs of repairing their motor vehicle. This approach will help minimize the expected increase in your annual insurance premiums had you included the repair of both motor vehicles in your insurance claim.

However, if you do not have the personal savings necessary to cover the repairs or replacement of your old motor vehicle with a brand-new motor vehicle you will likely have to:

(i) Consider your financing options;

(ii) Include your motor vehicle in your insurance claim and experience a greater increase on your annual insurance premiums; and

(iii) Consider purchasing a second-hand car.

If you decide the cost of repairing your old motor vehicle is not justifiable (i.e. cost of repair exceeds fair market value of the motor vehicle), and do not have the finances to facilitate the purchase of a replacement motor vehicle, you may want to consider the merits of submitting an insurance claim for the insured value of your old motor vehicle. Your insurer will then proceed to provide monies in the amount of the insured value of your old motor vehicle which can then be applied towards the purchase of a new motor vehicle or a second-hand motor vehicle.

In the event you submit an insurance claim, and your insurance provider is not willing to provide enough compensation to cover the purchase of a brand-new car (i.e. the insured value of your old motor vehicle is low), and you do not have enough personal savings to cover the difference, you will likely have to:

(i) Consider your financing options; and/or

(ii) Consider purchasing a secondhand car.

If you do claim on your insurance and your car is declared a write off by your insurer, ask your insurance company how they calculated the insured value of the motor vehicle (e.g. some insurers may write off a car if the cost of the repairs is as little as 60% of the fair market value of the car).

In some cases you may be able to negotiate that your insurers valuation of your motor vehicle is below fair market value and present evidence indicating that your motor vehicle is valued more (i.e. by providing a valuation conducted by an independent qualified mechanic).

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There will be circumstances where a consumer’s motor vehicle will require repair and maintenance services and the consumer will find themself unable to rely on their motor vehicle warranty due to either:

The required services falling outside of the terms and conditions specified in a dealership warranty (i.e. the repairs are not directly attributable to a manufacturer fault, or are due to wear and tear, etc.); or
The warranty being no longer valid (i.e. the warranty period has expired, or the consumer has acted in such a way to void the warranty).

Consequently, Consumer Affairs has observed that consumers commonly experience the following issues when seeking to have “out of warranty” maintenance and/or repairs performed on their motor vehicle:

Finding the right mechanic at the right price (i.e. customers favoring lower pricing over adequate qualifications and experience); and/or
Resolving issues which are directly attributable to the poor quality of service/performance of their mechanic (i.e. fails to exercise “reasonable care and skill”, delays, or overcharges).

The purpose of this section is to provide consumers guidance on how to navigate the consumer issues commonly experienced when seeking to have motor vehicle repairs and maintenance services performed which are not covered by a warranty.

If you experience an issue with the quality of a motor vehicle repair or service, Consumer Affairs advises that you contact the service provider immediately and attempt to negotiate with the mechanic to resolve the issue.

Under the Consumer Protection Act 1999, providers of consumer goods and services have an obligation to exercise “reasonable care and skill” when operating. By contacting the service provider (i.e. the mechanic or a customer service representative) and informing them of your issue and how you would like the issue resolved within a reasonable period of time (i.e. within 30 days of the services being provided), the garage may be willing provide additional services that will resolve your issue at no additional cost.

Consumer Affairs advises consumers to maintain timely, open communication with the service provider and to make genuine attempts at negotiating a resolution. If too much time passes between discovery of the issue (i.e. failure to perform adequate repairs) and the reporting the issue, your ability to rely on the Consumer Protection Act 1999 will weaken. The passage of time will weaken the "chain of causation" and make it harder to claim that the mechanic did not exercise “reasonable care and skill”. When the "chain of causation" is broken it will become very difficult to pinpoint whether the continued motor vehicle issue is due to the fault of the mechanic to provide adequate repair services or is due to the reasonable wear and tear of the motor vehicle following the completion of the prior repair services.

Following timely communication of your on-going issue with the service provider (i.e. repair services failed to address motor vehicle issue which has resulted in an on-going issue), it is advised to request the contact details of the garage representative spoken with and send a follow-up e-mail briefly describing what was discussed (i.e. acceptance of fault/failure to exercise reasonable care and skill and agreement to resolve your issue or dispute fault).

If when you call the garage your phone call goes unanswered, or the garage does not respond to a voicemail, send a formal e-mail to the garage outlining your issue. The contact details of the garage should be found either on their website or on an invoice provided.

If following the conversation with the garage it has been communicated that the mechanic does not accept fault and disputes your claim of poor quality of service (i.e. are subsequently unwilling to resolve the issue), submit a formal complaint to the garage.

If after filing a formal complaint your garage remains unwilling to resolve the issue, file a formal complaint with Consumer Affairs. Depending on the nature and merits of your complaint Consumer Affairs may contact the service provider and help resolve your issue.

Failure to Exercise Reasonable Care and Skill

If the maintenance or repair work provided by a mechanic did not resolve the issues reported, it may be argued that there was a failure to exercise “reasonable care and skill”. Where it is found that a mechanic failed to exercise "reasonable care and skill", the affected consumer is afforded the legal right to have the repair work performed again at no additional cost or receive the benefit of a price reduction through a refund.

In order to rely on this legal right as a consumer you have a burden of proof to provide evidence supporting your claim. In order to support of your claim Consumer Affairs advises that you obtain at least two opinions from two other registered and qualified mechanics to determine whether the services originally provided were done so in accordance with industry methods of best practice.

It is important to note you will likely incur an administrative fee from each of the mechanics who you have tasked with the responsibility of providing an opinion regarding the quality of the work performed.

Once you have obtained your supporting evidence indicating that the original mechanic did not exercise “reasonable care and skill”, as part of your negotiations with the original mechanic Consumer Affairs recommends that you:

Ask the garage for a partial refund of some of the payment you may have made in advance; and/or
Request the additional work to rectify the mechanic’s failure to exercise reasonable care and skill be performed at no additional cost to you.

Overcharges and Unauthorized Work

Consumer Affairs cannot understate the importance of obtaining a quote for services from at least three prospective mechanics. A “quote” is when a trader promises to work at an agreed price, whereas an “estimate” is a trader’s best guess as to how much the work will cost.

It is important to note that a quote is legally binding and affords consumers a higher degree of security and certainty when obtaining services. If the prospective mechanic provides an estimate, they have the ability charge beyond the estimated cost to provide a requested service so long as the price increase is within reason (i.e. cost of materials increase, additional services required, etc.). Given the pricing flexibility afforded to a service provider, where possible Consumer Affairs advises consumers to not accept an estimate in order to avoid price shock.

There may be circumstances where a previously provided quote may need to be adjusted in order to account for additional work that was not identified at the time in which the original quote was produced. If a mechanic identifies additional work not outlined in the original quote, they are obligated to:

Communicate the additional work identified to the customer;
Communicate the cost of the additional work identified to the customer; and
Obtain consent from the customer to perform the additional work

Prior to communicating your acceptance of a mechanic’s estimated or quoted price to provide services, try to negotiate the service price with each of your identified prospective mechanics as you may be able to negotiate a lower price.

As a consumer you have the right to refuse payment of any unauthorized work performed (i.e. you did not provide consent for the mechanic to perform the additional work) as it may be argued that the inclusion of additional work not previously accounted for in a quote/estimate amounts to a material change to the original contract. Material changes to an existing contract must be mutually agreed by both parties.

Undue Delays

As part of the shopping around process, the quote or estimate provided may specify the length of time needed to complete the services specified in the quote. When you request a quote/estimate from a prospective mechanic it is advised that you request the quote include an estimated date of completion. If you are unsure as to what would be a reasonable deadline to complete the requested service(s), a second opinion from another garage may serve as a reasonable estimate.

In addition to requesting an expected date of completion, if you receive a quote/estimate that indicates you may be subjected to an extended period of time without a motor vehicle, Consumer Affairs recommends consumers to ask whether the mechanic is able to provide a loaner vehicle.

If you accept a quote/estimate with an agreed completion date, and the delays experienced are due to the fault of the mechanic (i.e. undue delays), Consumer Affairs advises that you contact your mechanic and negotiate a new deadline for the requested work to be completed. If you have been subjected to undue delays, Consumer Affairs advises that you request the garage:

To provide an adjusted quote with a lower price which accounts for the undue delays that are the fault of the mechanic; or
For a partial refund of some of the payment you may have made in advance.

Damages to Motor Vehicle While in Mechanic’s Possession

If after collecting your motor vehicle from a mechanic’s garage you discover that your motor vehicle has been damaged while it was in the mechanic’s possession, Consumer Affairs advises that you:

Immediately contact the service provider and inform them of the damages; and
Request the service provider correct the damages caused at no additional cost.

Even if the garage posts a sign on their premises saying that they are not responsible for any damage caused to a motor vehicle in their possession, this would be considered an “unfair trade term” and an “unconscionable behavior”. Such commercial practices are considered a violation of the Consumer Protection Act 1999.

It is at this stage the Consumer Affairs notes the importance of maintaining open communication with your service provider and the necessity to make to make genuine attempts to negotiate with the mechanic to resolve the issue complained of. If too much time passes between discovery of the damage to the motor vehicle and the reporting of the damages, your ability to rely on the Consumer Protection Act 1999 will weaken (i.e. the "chain of causation" has been broken and liability cannot be assigned).

If the "chain of causation" is broken due to the passage of time, it will make it harder to claim that the mechanic did not exercise “reasonable care and skill” while the motor vehicle was in their possession and therefor pinpoint whether the damages are due to the fault of the mechanic or whether the damages occurred following collection of the motor vehicle.

Failure to immediately report the damages caused by the mechanic’s inability to exercise reasonable care and skill may impact your ability to make a claim for repairs as the mechanic may be able to counter argue that:

The damages did not occur while the motor vehicle was in their possession (i.e. after you collected the motor vehicle from the garage); or
That you knew of the damages at the time you collected the motor vehicle and that failure to report the damages within a reasonable period of time (i.e. report within 1 month) amounts to acceptance.

In order to establish that the mechanic did not exercise reasonable care and skill while the motor vehicle was in their possession, a burden of proof falls on the consumer to provide the evidence supporting their claim.

Appreciating that the burden of proof may be difficult to satisfy absent credible evidence, Consumer Affairs advises consumers to:

Take photographs of the exterior and interior of the motor vehicle before you leave it with a mechanic; and
Take photographs of the exterior and interior of the motor vehicle immediately after you have collected the motor vehicle.

By producing photographic evidence of the physical condition of your motor vehicle before and after services were provided, you will be able to evidentially prove which damages had been caused by the neglect of the mechanic.

Following a phone call with the mechanic’s customer service representative to discuss the damages caused to the motor vehicle, it is advised that you send the service provider an e-mail outlining what was discussed so that you have a record of communication that can be relied upon later if you decide to file a formal complaint and/or pursue legal proceedings.

If your negotiations are unsuccessful, submit a formal complaint to the mechanic’s garage. If following the submission of a formal complaint your mechanic continues to refuse to repair the damages they have caused, submit a formal complaint with Consumer Affairs and/or consider obtaining a lawyer to commence legal proceedings.

During the course of pursuing legal proceedings, you may want to consider having an alternative mechanic repair the damages caused by the negligent mechanic. Although this will result in additional costs (i.e. legal costs and the cost of repairs by the alternative mechanic), Consumer Affairs recommends that you include such costs as part of your legal claim against the mechanic.

Although you may attempt to negotiate with your mechanic to resolve issues that they have caused (i.e. undue delays, overcharges, damages while in their possession, etc.), Consumer Affairs recognizes that there will be circumstances where your negotiations are ineffective due to the mechanic’s unwillingness to accept fault.

In such circumstances Consumer Affairs advises that you consider:

Paying the garage “under protest”;
Submitting a formal complaint with Consumer Affairs; and/or
Pursuing legal proceedings.

Pay the Garage “Under Protest”

There may be circumstances where you acknowledge that you are liable for a portion of your mechanic’s invoice and dispute another portion of the invoice (i.e. overcharges, failure to perform some/all of the work performed). Alternatively, there may be circumstances where you are liable for the entirety of an invoice but require additional corrective services due to the mechanic's inability to perform all instructed services (i.e. mechanic replaced and installed new brake pads but scratched the car exterior, mechanic failed to resolve the faulty electronic windows, etc.).

In these circumstances you will be liable to pay the undisputed portion of the bill. Although you may file a complaint or pursue legal proceedings in protest of the portion of the bill that you do not agree with or for the corrective work that needs to be performed, at minimum you should pay the portion of the bill you agree with; especially if you need the motor vehicle back.

When you pay the undisputed portion of the bill, follow-up with a formal letter (i.e. physical letter via the post office or email) indicating that payment is for the portion of the bill not under dispute and that payment has been made “under protest”. In this circumstance it is likely that:

(i) The mechanic will pursue legal proceedings against you for the portion of the bill that you have not paid; or

(ii) You will have to pursue legal proceedings against the mechanic for the corrective work required.

In circumstances where legal proceedings have been started by the mechanic, Consumer Affairs advises that you collect your supporting evidence and consider obtaining a lawyer as you will have to state your position in court. If the court finds that your argument has merit, the court will likely determine that you do not have to pay the portion of the bill you dispute or that the mechanic is obligated to perform corrective services at no additional cost.

However, if the court finds that your position does not have merit (i.e. you do not have adequate supporting evidence to support your dispute), the court will likely require you to:

Pay the portion of the bill you dispute; and
Pay the mechanic’s legal fees.

If you do not have adequate evidence supporting your position, Consumer Affairs advises that you pay the bill in full in order to avoid having the mechanic pursue legal proceedings against you and avoid the risk of having to pay the mechanic’s legal costs in the event your dispute fails in court.

If you can’t afford to pay a portion of or the entirety of the bill, and require access to your motor vehicle, Consumer Affairs recommends that you: (i) offer to pay the mechanic what you consider is a reasonable amount in exchange for getting the car back; and (ii) agree to enter into a repayment plan to repay the outstanding bill.

However, consumers must remain mindful of the fact that a mechanic is not obligated to release a vehicle absent payment for services rendered. That in the event the mechanic agrees to release your vehicle, following receipt of partial payment, the mechanic may consider pursing legal proceedings against you if you do not pay the remainder of the bill.

Consumer Affairs Mediation

If following a failed attempt to negotiate and the filing of a formal complaint with your mechanic you find yourself unsatisfied with the outcome, it is advised that you file a formal complaint with Consumer Affairs. Consumer Affairs has the regulatory responsibility to assist consumers that have been subjected to “unfair trade practices” by acting as a mediator between consumers and service providers.

The benefit of mediation is that it affords affected consumers and commercial enterprises the opportunity to enter into dialogue with Consumer Affairs with the objective of arriving at an amicable resolution. Such dialogue will enable Consumer Affairs the ability to identify the facts of the matter, determine the merits of each party’s position and conclude whether a service provider is acting in contravention of Bermuda's consumer rights legislative framework. Mediation is beneficial for both parties as it presents the opportunity to resolve the issue while avoiding costly legal fees and the administrative burden of having to attend court.

If a commercial enterprise is found to be operating in contravention of Bermuda’s consumer protection legislative framework and is unwilling to resolve the harm caused to a consumer, Consumer Affairs has the legal authority to refer the matter to the Department of Public Prosecutions. In the event a matter is referred to the Department of Public Prosecutions, the commercial enterprise may be subjected to financial penalties and/or imprisonment.

Legal Proceedings

Depending on your circumstances and the extent of the harm caused, there may be times when paying the bill “under protest” or mediation is not appropriate.

In circumstances where your claim for damages is $25,000.00 or greater, it is advised that you consider obtaining independent legal counsel to assess the merits of your claim and determine whether it is in your best interest to pursue your matter in court. In the event that your claim is $25,000.00 or less, you may not require legal representation and may consider yourself capable of representing yourself in Magistrate’s Court. However, due to the complexity of the matter and/or your personal confidence in public speaking, it may be worthwhile to obtain an initial legal opinion before deciding whether or not you will represent yourself.

It is important to note that whether you obtain the formal legal representation or obtain an initial legal opinion, you will incur legal fees. Fortunately, depending on the nature of your claim and the extent of the damage caused, you may be able to include legal costs as part of your claim.

If you are unable to afford the upfront costs of a lawyer and are of the view that you require legal assistance, Consumer Affairs advises that you contact the Legal Aid Clinic and request a consultation. As part of the consultation Legal Aid will likely require you to complete a customer intake form and a personal financial statement prior to reviewing and advising on your matter.

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Warranties and guarantees supplement your existing legal rights currently embedded in Bermuda’s consumer protection legislative framework and can come in many forms. A warranty or guarantee could be on your receipt, in an email or given to you as a separate leaflet provided by the motor vehicle dealership.

If you cannot find the guarantee or warranty documentation, Consumer Affairs advises that you contact the motor vehicle dealership and request a copy. If your motor vehicle dealership does not offer a warranty at the time in which you purchase the new motor vehicle, it is important to note that section 14 of the Sale of Goods (Amendment) Act 2002provides consumers with an implied warranty when one is not offered.

If your motor vehicle dealership does not provide a warranty, and you experience manufacturer issues shortly after you have purchased the new motor vehicle (i.e. within 6 months) it is advised that you file a complaint against your motor vehicle dealership as soon as possible as your ability to rely on the Sales of Good (Amendment) Act 2002 will weaken with the passage of time.

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In order to for a motor vehicle to be legally operated on Bermuda's roads the motor vehicle must be physically inspected and licensed with the Transportation Control Department ("TCD) and the motor vehicle must have at least third-party motor insurance coverage. When you are considering obtaining motor vehicle insurance Consumer Affairs advises consumers to shop around in order to find a motor vehicle insurance policy that:

Covers your needs;
Is reasonably priced with respect to the level of coverage provided; and
Fits your monthly budget.

During the shopping around process, it is important to understand that there are three main types of motor vehicle insurance:

1. Third Party Insurance: This is the minimum amount of insurance coverage a user of a motor vehicle is required to obtain in order to legally operate a motor vehicle on Bermuda's road. Third party insurance provides financial coverage in circumstances where a user of a motor vehicle is found liable for causing damage to another person and/or their personal property in a motor vehicle accident. Although one of the cheapest forms of motor vehicle insurance, third party insurance does not cover the cost of repairs to the policy holder’s own motor vehicle, or any personal harm caused to the policyholder (i.e. personal injury claims).

2. Third Party, Fire and Theft Insurance: This type of insurance is considered a more comprehensive form of third-party insurance. Although slightly more expensive that standard third-party insurance, third party fire and theft insurance covers damage or loss to the policy holder’s motor vehicle resulting from fire or theft.

3. Fully Comprehensive Insurance: Being one of the more expensive forms of motor vehicle insurance, fully comprehensive insurance often includes, but is not limited to:

Third party coverage;
Fire, theft and repairs to your own motor vehicle;
Death or injury of yourself or a family member, up to a set amount;
Replacement of belongings stolen from your car;
Legal expenses; and
The cost of hiring a replacement vehicle.

The Bermuda Police Service, as part of a roadside inspection, have the authority to conduct a “stop and search” to confirm whether a motor vehicle in use is insured. As part of their inspection the Bermuda Police Service has the ability to access the Bermuda Transportation Control Department’s motor vehicle registration database.

If it is confirmed that you have been driving your motor vehicle while uninsured, the Bermuda Police Service have the authority to seize the motor vehicle immediately. Additionally, the Bermuda Police Service have the authority to impose a civil penalty which will require the owner of the motor vehicle to attend Traffic Court and likely be being found guilty of a road traffic offense and a financial penalty.

In order to retrieve your motor vehicle from the Bermuda Police Service impound lot you will have to produce a certificate of insurance and pay any related impound fees. If you do not collect your impounded motor vehicle within a reasonable period of time (i.e. 30 days from the day the motor vehicle was impounded), the Bermuda Police Service can either:

Dispose of your motor vehicle; or
Make your motor vehicle available for purchase at a public auction.

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If you find yourself in motor vehicle accident and require assistance covering the cost of repairs and/or medical assistance, depending on the terms and conditions of your motor vehicle insurance policy you can submit an insurance claim which may cover some or all of the associated costs.

However, in order to effectively gain the benefit of your insurance policy through submission of an insurance claim, you must ensure that you act in compliance with the terms and conditions of your motor vehicle insurance policy. Depending on your actions, your insurer may not provide full or partial coverage as your insurance policy may be rendered void due to non-compliance.

The purpose of this section is to consider the pitfalls that consumers commonly experience when making a claim and provide guidance on how to act in compliance with the terms and conditions of an insurance so that you may effectively gain the benefit of your insurance policy following the submission of an insurance claim.

Consumer Affairs cannot understate the importance of acting in compliance with the terms and conditions outlined in a motor vehicle insurance policy. If your insurer discovers that you have been non-compliant, your insurer has the right to refuse your insurance claim and render your insurance policy void. In this circumstance you will likely have to pay for the damages incurred as a result your accident (i.e. property damage, medical assistance, etc.) through your personal savings or through borrowing money from a friend or financial service provider.

Although this is not a fully exhaustive list, as a consumer of a motor vehicle insurance policy it is important to be mindful of the fact that the following types of consumer behavior may render your insurance policy void:

Whether someone not covered by the policy was operating the motor vehicle at the time in which accident, and associate damage, occurred;
Whether your motor vehicle was considered un-roadworthy at the time of the accident;

Whether you were driving someone else's motor vehicle (i.e. may not be able to claim on your own motor vehicle insurance or the insurance policy of the owner of the motor vehicle);
Whether you did not have a valid driving license at the time in which accident and the damage occurred;
Whether your insurer thinks that you are fully/partly to blame for the accident and resulting damages;

Consumer Affairs advises consumers to carefully review the terms and conditions of their motor vehicle insurance policy ensure that they understand the obligations embedded throughout. My remaining mindful of which types of behavior will render your insurance policy void, you will be able to ensure that you are acting in compliance and that your ability to make an insurance claim is not compromised.

If there are any terms and conditions, or performance obligations in your insurance policy that you do not understand, contact your insurer and arrange a meeting to discuss. Ideally this is a discussion that will be held with your insurer prior to paying the insurance premium, however, it may be worthwhile to have follow-up discussions in the future to avoid confusion.

If your motor vehicle insurance policy is in effect (i.e. paid the annual insurance premium and have acted in compliance with the terms and conditions of the insurance policy) the circumstances of the motor vehicle accident (i.e. single motor vehicle, multiple motor vehicle) and your contributing actions towards to the accident (i.e. who is liable for the accident occurring and to what extent) will influence your insurer’s decision to provide full or partial coverage.

Assuming that you have acted in compliance with the terms and conditions of your insurance policy, the type of insurance and the extent of the damages will influence whether you consider it worthwhile to submit an insurance claim.

Fully Comprehensive Insurance

If you are liable for the occurrence of a multiple vehicle accident and have a fully comprehensive motor vehicle insurance policy, the other party to the accident will be able to submit an insurance claim with your insurer to cover the cost of damages. Additionally, you may want to consider submitting an insurance claim as your fully comprehensive motor vehicle insurance policy will likely cover the cost of damages you have incurred.

Depending on the extent of the damages to your own motor vehicle (i.e. minor damages that can be easily repaired through personal savings), you may request your insurer to cover the costs of repairing the damages experienced by the other party and elect to cover your damages through your personal savings. This will ensure that any increases to your annual insurance premium are minimal.

Alternatively, if you are a party to a multiple motor vehicle accident, and the other party is at fault, Consumer Affairs recommends that you obtain the insurance details from the other party and submit an insurance claim with the insurer of the other party. At minimum the other party is legally obligated to have third party motor vehicle insurance which should cover the damages you have incurred.

If the other driver’s insurer determines that you are responsible, absent a formal investigation by the Bermuda Police Service which disputes the insurer’s position, you will have to pay for repairs to your own vehicle. If you are of the view that the insurer of the other party is incorrect in their assessment of liability, Consumer Affairs recommends that you obtain a lawyer as you may be able to dispute their finding of fault.

If you are a party to a multiple motor vehicle accident, the other party is at fault, and the other party was driving a company vehicle, Consumer Affairs advises that you inform the the company that a driver of one of their vehicles has been involved in an accident and that you intend to submit an insurance claim with their insurer.

After contacting the company and their insurer, Consumer Affairs recommends that you contact your insurer and inform them that you have been in a motor vehicle accident have submitted a claim an insurance claim against the other party to the accident.

As part of any insurance claim you will be required to provide documentation and evidence in support of your claim (i.e. a mechanic’s quote to repair damages, police report, medical bills, etc.). When making an insurance claim Consumer Affairs advises that you produce a personal copy of the insurance claim form you intend to submit and keep copies of all documents, evidence and letters submitted to the insurer.

If the other party to the accident is uninsured or cannot be identified at the time of the accident, you can claim on your own insurance if you have fully comprehensive insurance coverage.

However, this will result in an increase in your annual insurance premium. If you wish to avoid incurring an increase in your annual insurance premium, you may want to consider paying for the damages through personal savings and obtaining legal counsel in order to pursue a civil claim against the other party for the cost of damages incurred.

Third Party Insurance

If you are liable for a multiply vehicle accident and have a third-party insurance policy, the other party to the accident will be able to submit an insurance claim with your insurer to cover the cost of repairing their damages. Given the limitations of third-party insurance, you will not be able to submit an insurance claim and will have to cover the cost of your own damages through personal savings or through borrowing.

If you are a party to a multiple motor vehicle accident, and the other party is at fault, Consumer Affairs recommends that you submit an insurance claim with the insurer of the other party and allow the insurer to decide who is responsible for the accident.

If the other driver’s insurer determines that you are responsible you will have to pay for repairs to your own vehicle. If you are of the view that the insurer of the other party is incorrect in their assessment of liability, Consumer Affairs recommends that you obtain a lawyer as you may be able to dispute their finding of fault.

If you are a party to a multiple motor vehicle accident, the other party is at fault was driving a company vehicle, contact the company and inform them that one of their drivers has been involved in an accident and that you intend to submit an insurance claim with their insurer. After contacting the company and their insurer, contact your insurer and inform them that you have been in a motor vehicle accident and have submitted a claim against the other party to the accident.

As part of any insurance claim you will be required to provide documentation and evidence in support of your claim (i.e. a mechanic’s quote to repair damages, police report, medical bills, etc.). When making an insurance claim produce a personal copy of the insurance claim form you intend to submit and keep copies of all documents, evidence and letters submitted to the insurer.

Insurance Claims and Increases in Insurance Premiums

Although you may have motor vehicle insurance (i.e. fully comprehensive, third party), it is important to remember that if you make an insurance claim against your insurance policy this will result in an increase in your annual insurance premium.

Depending on the extent of the damage incurred(i.e. minor damages), and the type of insurance you have, it may be worthwhile to pay some, or all, of the damages through personal savings. The increase in your annual premium may not justify the submission of an insurance claim if you have personal savings readily available.

By utilizing personal savings to cover the costs of repairing minor damages you will be able to avoid unnecessary increases in your annual insurance premiums and experience cost savings in the long-term.

If you intend on renting a motor vehicle while travelling, Consumer Affairs advises that you arrange for motor vehicle insurance before leaving the island by either: (i) contacting your insurer at least one month before you travel; and/or (ii) acquiring a motor vehicle insurance policy with a motor vehicle rental company.

Many insurers offer third-party cover while overseas. However, many insurers do not offer fully comprehensive coverage which could leave you out-of-pocket if you damage a rented a motor vehicle. In the event a Bermuda based insurance provider is unwilling to provide fully comprehensive motor vehicle insurance while you are abroad, it may be worthwhile to contact the motor vehicle rental company to discuss their insurance options.

If you are involved in a motor vehicle accident when travelling abroad, Consumer Affairs recommends that you:

Do not move your motor vehicle or permit the other parties(if applicable) to the accident to move their motor vehicle;
Call the local police and emergency assistance to obtain help and start an accident investigation. If you do not understand what you are being told (i.e. foreign language), Consumer Affairs recommends that you ask for an interpreter

Do not admit liability (i.e. fault) at the scene and consider obtaining a lawyer for guidance;
Exchange names and other details (i.e. contact information, insurance policy information) with the other drivers and get contact information of any independent witnesses to the accident. If someone refuses to give you their details your insurer may be able to trace them through their vehicle registration number

Contact your insurer about the accident immediately, even if you do not want to make a claim;
If someone is injured in the accident, show your insurance certificate or insurance cover note to the local police department present at the accident; and
Take photographs of the accident (i.e. the location of the vehicle(s), license plates and the damages incurred) so that you have evidence which may be used to make an insurance claim and/or support legal proceedings.

If you are driving in Europe and have reported an accident, a member of the local police or emergency service unit (i.e. the EMTs on-site providing medical help) may give you a European Accident Statement (EAS) at the scene of the accident. An EAS is a standard form made available throughout Europe and is available in various languages.

The EAS helps the parties to a motor vehicle accident establish an agreed statement of facts about the accident and can help with submitting insurance claims. Consumer Affairs recommends that you only sign an EAS if you are in complete agreement with the contents of the EAS. Once you are comfortable with the contents of the EAS it is advised that you obtain a copy of the EAS after you provide your signature.

When driving a rental vehicle, it is important to report even minor accidents to the local police and the rental car agency before you return to Bermuda. As part of their rental policy rental car agencies may require that all accidents are reported. It can be very difficult to dispute any reported damages once you have left the country. Consumer Affairs advises all consumers to carefully review the terms and conditions of the motor vehicle insurance policy applied to the rented motor vehicle and see what charges/penalties may be applied as a result of failing to report an accident.

If you elected to solely rely on your existing motor vehicle insurance policy held with a Bermuda based insurance provider, in addition to contacting the rental company it is advised that you contact your insurer as soon as possible; even if you don’t want to make a claim. Insurance policies have a time limit for reporting accidents and if you fail to meet this you may not be covered. You should give your insurance provider as much information about the accident as you can as it will help them process your claim.

If you have been involved in a motor vehicle accident while travelling abroad there may be circumstances where you will need to submit a personal injury claim. However, this can be very complicated and expensive. If you are thinking of submitting a personal injury claim to the cost of damages incurred following an accident that occurred while on holiday, Consumer Affairs advises that you seek legal advice.

If your motor vehicle is stolen, even for a short period of time, Consumer Affairs recommends that you immediately inform the Bermuda Police Service and review the terms and conditions of your motor vehicle insurance policy to confirm whether your motor vehicle insurance policy:

(i) Covers the cost of a replacement vehicle; or

(ii) Will provide financial compensation equal to the insured value of the motor vehicle at the time in which it was stolen.

If your motor vehicle is brand new (i.e. purchased within the last year) your insurance policy may state that if your motor vehicle is stolen it will cover the cost of a replacing a stolen motor vehicle. If your motor vehicle is old with a low insured value your insurance policy will likely only provide coverage for the insured value of your motor vehicle.

If you are not satisfied with how much your insurer is willing to offer you for your stolen motor vehicle, try to provide your insurer with evidence indicating that your motor vehicle is worth more that the coverage they are willing to provide (i.e. using car price guides or independent third-party mechanic quote).

After you have confirmed the insured value of your stolen motor vehicle and your level of coverage, assess whether it will be worthwhile to:

File an insurance claim to replace the stolen or vehicle or obtain the insured valued of the motor vehicle, at the expense of increased annual insurance premiums; or
Replace the stolen vehicle either through personal savings or a personal loan.

If your motor vehicle is brand new the increased annual insurance premiums you will incur will likely be justified given the costs associated with purchasing a brand-new replacement motor vehicle through your personal savings or a personal loan.

If your motor vehicle is old it is likely that the increased annual insurance premiums will not be justified. It is important to conduct a cost-benefit analysis to determine the financial impact of making an insurance claim in the short-term and the long-term.

Before providing any financial relief for a stolen motor vehicle your insurer may wait to see if the motor vehicle is found. Consequently, you may be exposed to delays in receiving financial relief and obtaining a replacement motor vehicle. If your insurance provider settles your claim and the motor vehicle is then found, your insurer will keep the previously stolen motor vehicle.

Alternatively, you may also experience delays with your insurance claim in the event you have not provided enough evidence in support. In this circumstance your insurer may contact you, and other related parties, and request that further supporting evidence be provided. If your insurer requires further information Consumer Affairs advises that you provide all requested information as soon as possible to avoid undue delays.

Appreciating that there are circumstances where it would be reasonable to experience a delay in settling a stolen motor vehicle claim, insurers are legally obligated to settle claims within a reasonable period of time (i.e. within three months) so long as all supporting documentation and evidence has been provided.

If you have been subjected to unreasonably long delays in settling a stolen motor vehicle claim, submit a formal complaint to your insurer using their internal complaints process. If you are unsatisfied with the outcome of your complaint, Consumer Affairs advises that you submit a formal complaint with the Bermuda Monetary Authority.

Table of contents

Motor Vehicles

GARAGES LICENSING ACT 2002

Buying a Used Motor Vehicle

Negotiating the Sales Price of a Used Motor Vehicle

Purchasing a Motor Vehicle and Financing

Common Consumer Problems when Buying a New motor vehicle

Motor Vehicle Repairs Following an Accident

Motor Vehicle Repairs Outside of Warranty and Common Consumer Issues

Motor Vehicle Warranties and Guarantees

Motor Vehicle Insurance

Motor Vehicle Insurance Claims