The Nominal Defendant is a statutory body established under the Motor Accident Insurance Act 1994 (MAI Act) for the purpose of compensating people who are injured as a result of the negligent driving of unidentified and/or uninsured (no Compulsory Third Party (CTP) insurance) motor vehicles. The Nominal Defendant Fund was first introduced in 1961.
The Nominal Defendant operation is funded by a levy within the CTP insurance premium. The levy is set on the basis of an actuarial assessment of claim trends.
With regard to claims involving uninsured motor vehicles, the Nominal Defendant has the right to recover as a debt, the amount paid in settlement of the claim from the owner or driver (or both) of the uninsured motor vehicle.
The Nominal Defendant is to be taken as a licensed insurer. Under the MAI Act, the Nominal Defendant has the extended role of meeting the claim costs of any licensed insurer who may become insolvent.