Lloyd's Market Association Bulletin

LMA17-016-AC  |  19 April 2017

Consumer Wordings Guidance v3.0 

The latest version of the Joint LMA/Clyde & Co Guidance on Consumer Wordings is available to download from the LMA website, and contains a Document Revision/Change History page to identify the key amendments/updates.

Consumer Wordings Guidance v.3.0

The updated guidance includes:  

  • Claims handling – clarification added regarding insured’s duty to mitigate the loss
  • Data Protection (GDPR) – placeholder added
  • Rights of Third Parties – further clarified Third Parties (Rights Against Insurers) Act 2010
  • Law and Jurisdiction – added Lloyd’s requirement
  • Definitions – expanded guidance
  • Exclusions – expanded guidance
  • Other Documentation – added new Renewal Documentation section to incorporate new FCA rules on “renewals transparency” which took effect from 01 April 2017 (FCA Policy Statement PS 16/21)
  • Addition of Appendix 13 entitled Renewals Transparency - FCA Policy Statement PS16/21.

At the time of its initial publication (version 1.0, 27 April 2015), we advised that the guidance would undergo a periodic review process by the LMA and, therefore, remain subject to amendment/update when required (e.g. due to change/update in relevant legislation/regulation etc). The LMA re-published the guidance on 27 July 2015 (v1.1) following the publication of the LMA’s Guidance on the Insurance Act 2015, again on 13 January 2016 (v2.0) following implementation of the Consumer Rights Act 2015 and also on 30 November 2016 (v2.1) to provide guidance regarding the Enterprise Act 2016 and the Third Party (Rights Against Insurers) Act 2010.

The document is published as general guidance, intended to assist managing agents with the practicalities of drafting new consumer products and/or adapting existing commercial wordings to produce consumer versions. Whilst not an exhaustive list of all the issues to consider, the guidance identifies the key features of, and salient clauses within, a policy document/wording that need to be addressed for a consumer policy to meet current regulatory requirements and identifies, where appropriate, the applicable underlying regulation. Example clauses are also provided, where applicable. Any queries on the guidance may be addressed to:

Lloyd's Market Association  Clyde & Co LLP 
Alison Colver
Ian Plumley
Manager, Wordings
Email: alison.colver@lmalloyds.com
Email: ian.plumley@clydeco.com
Steve Morrell
Matthew Ditchfield
Manager, Legal and Compliance
Email: steve.morrell@lmalloyds.com
Email: matthew.ditchfield@clydeco.com

Alison Colver
Manager, Wordings