CMS' Insurance and Reinsurance Group has issued the June 2015 edition of Insurance Issues, a six-monthly review of key issues and claims trends for the insurance market.
February saw the passing of the Insurance Act 2015, introducing the most significant reform of insurance contract law in over 100 years. The Act will come into force on 12 August 2016 and will apply to insurance contracts from that date, although some insurers and insureds may choose to ‘opt in’ to the Act earlier. The Third Parties (Rights against Insurers) Act 2010 is also likely to come into force later in 2015, introducing changes to the regime under which third party claimants can recover directly from the insurer of an insolvent insured.
As well as these important legislative changes, there have been a number of interesting caselaw developments for insurers, including the Supreme Court’s ruling in Jetivia v Beltec on the illegality defence (reconsidering the House of Lords’ decision in Moore Stephens v Stone & Rolls Limited), the decision in Western Trading v Great Lakes on the defence of lack of insurable interest and the Court of Appeal’s guidance in Aspen Insurance v Adana Construction on the definition of ‘Product’. PI insurers will also be considering the implications of the decisions in Barclays v Grant Thornton (where it was held that accountants could rely on disclaimers of liability in audit reports they had prepared and did not owe a duty of care to a third party lender), Goldswain v Beltec (where the TCC rejected an attempt to extend the scope of an engineer’s ‘duty to warn’) and Chancery v FOS (the High Court held that the Financial Ombudsman Service had jurisdiction to consider a tax mitigation scheme where there was an element of investment advice).
As the insurance market prepares for the coming into force of the Insurance Act, while at the same time assessing the consequences of a possible ‘Brexit’, the second half of 2015 looks set to remain a busy period for the sector.
We hope you find Insurance Issues useful and informative. We are always keen to hear your views on our publications. If you have any comments, or if there are areas you would like us to cover in future editions, we would very much like to hear from you.
To download a copy of the full report, please click here. If you would like hard copies or any further information please contact Diane Jerry.