Appeals court rules against insurance company in claim recovery case

The Appeals Court has dismissed an appeal by ERB Asfalistiki Limited, upholding a previous decision by the Famagusta District Court. The case dates back to a traffic accident on September 21, 2010, in Paralimni, where a minor, K.G., drove his mother's motorcycle without a license and struck a minor pedestrian, D.A. Although the motorcycle was insured for third-party liability, the driver was not authorized under the policy. Following a claim by the injured party, the insurer settled the case out of court for €18,521. The insurance company subsequently sought to recover this payment from the mother, who refused to pay, citing her lack of liability. The court ruled that an insurer cannot unilaterally decide a client's liability and demand reimbursement without a preceding judicial determination. The judges emphasized that there was no court order establishing responsibility for the accident. Consequently, the claim for recovery was deemed invalid by the courts. The decision sets a precedent regarding the limitations of insurers in seeking indemnity for out-of-court settlements.