Risk manager guide covers U.K. legal changesReprints
Commercial insurance buyers will face new legal obligations to insurers when the U.K. Insurance Act 2015 comes into force, London-based risk management association Airmic Ltd. said Wednesday when launching a guide to the law.
The Insurance Act will come into force for all policies incepting from Aug. 12.
Among other things, the law will require buyers to be aware of “what should reasonably have been revealed by a reasonable search” and disclose that information “in a manner which would be reasonably clear and accessible to a prudent underwriter.”
Insurers will no longer be able to use “basis of the contract clauses,” which previously allowed them to avoid a claim if unrelated information that would have caused them to refuse a claim comes to light.
In its guide to the law, Airmic says corporate insurance buyers should start preparing for the new requirements and provide underwriters with exposure information in a clear and accessible manner.
“This is a great opportunity and challenge for our members,” said John Hurrell, CEO of Airmic.
“They will have the chance as never before to control their insurance programs, and to be confident that claims will be paid in full. However, the spotlight will be on them, and the quality of their data will become even more important than it has been in the past,” Mr. Hurrell said in a statement.
“Up to now, we have urged buyers to start the process 180 days before the renewal date — we now believe it would be prudent to start even earlier than that,” he said.
“They need to be proactive and get the ball rolling,” Mr. Hurrell said.