The Insurance Act 2015 came into force last August and was hailed by many as the biggest change to insurance law in the UK for more than 100 years.
At the time, there were questions over whether insurers and brokers were fully prepared to comply with the regulation, which shifted the balance between the industry and its commercial clients.
Confidence within the industry, however, was high.
Don’t miss out on the Insurance Business Insurance Law Masterclass – find out how you can be part of the event now.
An Airmic study, conducted two weeks before the Act became effective, revealed that more than 90% of respondents felt they were fully or relatively prepared for the law change.
Similarly, among the wider market, 90% felt their brokers were at least relatively prepared, and 85% said the same about their insurers.
Paul Lewis, partner at Herbert Smith Freehills, where he leads the insurance disputes team in London, spoke to
Insurance Business about the impact of the law on the industry.
Want the latest insurance industry news first? Sign up for our completely free newsletter service now.
“The industry had a large amount of lead-in time to get used to the fact that [the Act] was coming in, and to prepare for it,” he said.
Lewis – who will be leading a session on the Insurance Act at the
Insurance Law Masterclass in June – explained that the law means policyholders and their brokers have had to reflect on how they present risks, which includes complying with the obligation to present them in a clear and accessible manner.
Since the change, brokers have also been pro-active in putting out different forms of wordings, “to try and, in some cases, improve on the Act for their clients,” Lewis explained.
Some insurers and trade bodies, such as the LMA, have been getting in on the action by putting out their own wordings.
“There’s been a huge amount of training that’s gone on among the industry, so I think everyone has rightly put an emphasis on education,” Lewis commented. “There’s been a lot of questions that insurers have had to address as to how they’re going to respond to the Act.”
With the Act being a completely new piece of legislation, insurance businesses have had to put the work in to educate and come up with corporate policies “across basically their whole book of business,” Lewis said.
While it’s too early to say exactly what the effect of the regulation will be, looking forward, Lewis explained that there is clear potential for areas of disagreement in the claims process.
You can hear more in-depth analysis on these issues – plus the impending Enterprise Act, coming into force next month – at the
Insurance Law Masterclass, taking place on June 08 at The Grange City Hotel in London.
Related stories:
New riot compensation law comes into force this week
Cyber case law: Why all areas of insurance need to take note
