6 August 2015
LMA and IUA launch Insurance Act 2015 ‘quick reference guide’
Having recently published a detailed analysis of the Insurance Act 2015, the LMA and IUA have today released a ‘quick reference guide’ for underwriters and wording specialists in the London insurance market. This pulls together the headline provisions of the new Act and points for practitioners to consider in the underwriting process.
The quick reference guide and the detailed guide (published in June 2015) is available to download from the LMA website: www.lmalloyds.com/Act2015 and IUA website: www.iua.co.uk/insuranceact.
Kees van der Klugt, Director of Legal and Compliance at the LMA, says “The quick reference guide is designed for underwriters and support staff to have at their elbow, as a day-to-day aide for underwriting and agreement of contract terms. We are dropping hard copies on all underwriting boxes in Lloyd’s in addition to publishing it widely electronically. A great deal of thought has gone into this to make it as useful as possible for everyone involved in underwriting. ”
Kees adds that the LMA and IUA have shared both the detailed guide and this new guide at the drafting stage with LIIBA, BIBA and AIRMIC. "We and the IUA are talking to our counterpart associations on what further work we can do to assist a smooth transition to the new regime and in terms of developing model wordings for use after 12 August 2016. Our members will be fully involved in the further work."
Chris Jones, Director of Market Services at the IUA, said: “This further, practical guide is the culmination of a great deal of work with IUA and LMA members and with several leading law firms. Having lobbied extensively on the Insurance Act provisions and raised awareness of the Act via a series of market seminars the challenge for insurers is to now ensure that the underlying principles of the Act are, where appropriate, embedded into policy wordings and the underwriting approach. We will continue to work with our member companies to assist in this regard.”
The quick reference guide was prepared by Harry Wright of barristers' chambers 7 King's Bench Walk in association with law firms Clyde & Co, Cooley LLP and Ince &Co, and with input of LMA and IUA members. This supplements the detailed guide published in June and follows the seminar programme run for Lloyd's syndicates and London insurers during May and June this year.
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Notes to Editors
The Insurance Act 2015 makes substantial changes to insurance and reinsurance contract law in the UK, including amendments to the Marine Insurance Act 1906. It will therefore affect all contracts where English law is the applicable law. The Act became law in February 2015 and comes into force on 12 August 2016 after an 18 month transition period.
For information, this is an extract from the LMA/IUA joint press release dated 6 February 2015:
Kees van der Klugt, Director of Legal and Compliance at the LMA, commented: “In our evidence to the House of Lords committee, which carried out the substantive scrutiny of the proposed legislation, the LMA made clear its support for the core reforms: proportionate remedies for pre-contractual non disclosure; the banning of “basis clauses”; breach of warranty having the effect of suspending rather than discharging cover; and forfeiture being the remedy for fraudulent claims.
[He continued] “We were less supportive of some other changes which did not appear central to the reform programme or to be problem areas in existing law. All changes in the law will to some extent produce uncertainty, as the House of Lords committee acknowledged, and the purpose of our guidance will be to identify these areas so that appropriate action can be taken in underwriting and drafting contracts.”
About the Lloyd’s Market Association (LMA)
Formed in 2001 and located in the heart of the Lloyd’s Building in the City of London, the Lloyd's Market Association represents the interests of the Lloyd’s underwriting community. All underwriting businesses at Lloyd’s are members, together managing gross premium income of around £26 billion per annum.
For further information please contact:
James Milne, Communications Manager
Lloyd’s Market Association
T 0207 327 8405