Eighteen months since the Insurance Act 2015 came into force the FCA is presently considering whether (and how) more SMEs should fall within the jurisdiction of the Financial Ombudsman Service. At present only smaller SMEs (“micro- businesses”) with €2m turnover and fewer than 10 staff can seek a FOS adjudication on disputed insurance issues. The FCA Consultation, concluding on 22 April, is seeking views on whether eligibility should be extended to small businesses with annual turnover of less than £6.5m and fewer than 50 employees. It is estimated that such an extension would provide an additional 160,000 businesses with access to the Ombudsman. In assessing how to respond to this consultation it is useful to consider the impact of the Insurance Act since the commencement on 12 August 2016. Continue reading
2017 is now upon us, meaning that implementation of the “late payment” amendment to the Insurance Act 2015 on 4 May is fast approaching. This amendment, set out at part 5 of the Enterprise Act 2016 introduces an implied term into all insurance contracts (and variations) entered into after this date that claims will be paid “within a reasonable time”.
While it is the aim of all insurers to pay claims in a timely manner, sometimes, particularly with claims where concerns arise over potential fraud, payment may be delayed while the claim is validated, potentially giving rise to a claim by an insured for late payment.