On 4 May 2016 the Enterprise Act 2016 received Royal Assent.
Sections 28 to 30 of the Act, which relate to damages for the late payment of insurance claims, will come into force on 5 May 2017. From that date, insurers will face potential liability in damages if claims are not paid within a “reasonable time”, determined by taking into account the type of insurance, the size and complexity of the claim, compliance with relevant statutory or regulatory rules or guidance and whether there were factors outside the insurer’s control.
The Enterprise Act applies to reinsurance as well as insurance. For further details, see our 22 October 20151 and 20 November 20152 bulletins.