Government agrees to consider proposed amendments to Enterprise Bill tabled by the UK insurance industry
The Enterprise Bill includes, at clauses 20 and 21, provisions for the introduction into insurance law of a contractual obligation on insurers to pay claims within a reasonable time, for breach of which compensation to policyholders may be payable.
An unprecedented alliance of key players in the UK insurance industry (including Mactavish, Lloyd’s, Lloyd’s Market Association (LMA), International Underwriting Association (IUA), the Association of British Insurers (ABI) and Airmic) wrote to Business Minister Baroness Neville-Rolfe on 17th November 2015 expressing support for the inclusion of this clause in the Enterprise Bill, subject to certain recommended amendments. The bid to form a consensus across the insurance market was orchestrated and driven by Mactavish.
The support from both sides of the insurance industry and the recommended amendments were based on an Opinion provided by Colin Edelman QC and Richard Harrison of Devereux Chambers on the instructions of Mactavish.
The proposed amendments were: putting a time limit of one year on claims for damages from policyholders; and insurers being entitled to prove that they had sought and obtained legal advice to the effect that they had reasonable grounds for disputing the claim without thereby generally waiving privilege in the advice they had obtained.
The proposed amendments set out in the letter were debated at length in the House of Lords on the evening of Wednesday 25th November. The Government have agreed to consider the amendment on limitation though it now seems unlikely that the amendment on privilege will feature in the legislation.
Devereux commented: “Colin Edelman QC and Richard Harrison were delighted to have been instructed by Mactavish to provide an Opinion on clauses 20 and 21 of the Enterprise Bill. Our brief was to address the concerns expressed about the Bill and assist in identifying a suitable solution to any concerns we considered to be legitimate whilst maintaining the aim of achieving fairness for policyholders faced with late payment of insurance claims.”
The Enterprise Bill is expected to become law in 2016.Back to News
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