• Sharebar
Wednesday, August 13, 2014 - 02:16
Helping consumers

The Law Commissions are about to produce in a final bill, bringing into effect their long-awaited proposals for reform of insurance law. They have been working on these reforms for eight years and are now striving to ensure their bill makes it onto the statute books before the end of March 2015 (and ahead of the next election).

Comments Nigel Brooke, Head of Reinsurance at Clyde & Co, "The changes will affect every insurance policy written in England, Wales and Scotland 18 months after the bill receives royal assent (that is, probably policies taken out after September 2016). Together with the consumer insurance reforms that came into effect last year, these represent the greatest change to insurance contract law in this country in over 100 years. Some of the more robust defences currently available to insurers are likely to be watered down, although insurers will be allowed to contract out of most of the changes for policies bought by companies and businesses. Some of the changes which the Law Commissions intend to introduce include:
(1) A change in the remedies available to insurers if a company does not given them accurate and complete information when a policy is taken out, (these changes came into force last year for consumers);
(2) A relaxation of the rules relating to certain policy conditions, which will allow policyholders a chance to put breaches right and restore coverage;
3) The possibility of insurers being forced to pay damages (and not just interest), on valid claims which are paid late for no good reason. This change is proving particularly controversial and may be taken out of the final bill".

Brooke has been a partner at Clyde & Co since 1985 and is head of the firm's reinsurance team. He handles international reinsurance disputes for a range of companies and syndicates, both in the London market and worldwide. He also drafts and advises on insurance and reinsurance wordings, advises on global policies covering multinationals (including regulatory aspects, financial interest cover, and arrangements with captives), handles trade credit insurance and reinsurance matters and advises on economic sanctions and their impact on (re)insurers and brokers.

Copyright © Insurance Times and Investments® Vol:27.8 1st August, 2014
1570 views, page last viewed on October 9, 2020