Airmic has produced its long-awaited guide to the Insurance Act, which is being sent to all members and partner organisations. The key message to risk managers is that it is up to them to take control of the buying process. The guide urges corporate insurance buyers to start preparing for the Act now, instead of waiting until August when it comes into force or for their brokers and underwriters to give them the necessary advice.
The guide will be supported with on-line Airmic Academies for members in late-February and March. Describing the legislation as the biggest change to UK commercial insurance in more than 100 years, the guide warns that it will demand a high level of professionalism from all concerned, including buyers. Although policyholders will be protected from the draconian provisions of the current legal framework, the Act gives them new responsibilities.
In particular, it says, “the duty of fair presentation is more specific on whose knowledge must be disclosed. Insureds should consider what information they need to disclose, who holds this information and how they will capture it.”
Airmic’s guide stresses the need to provide underwriters with risk information in a clear and accessible manner. It should include all relevant information known to senior management as well the individuals responsible for buying insurance. It should also encompass information that would be gained from a ‘reasonable search’.
“This is a great opportunity and a great challenge for our members,” said Airmic chief executive John Hurrell. “They have the chance as never before to control their insurance programmes, and to be confident that valid 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.
“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. They need to be proactive and get the ball rolling.”
The Insurance Act applies to all policies incepting from August 12. As well as advice from Airmic, the guide contains contributions from Ace, AIG, Allianz, Aviva, Axa, Herbert Smith Freehills, Mactavish, Marsh, Willis, TBIAS, XL Catlin and Zurich.
