2018 will almost certainly see post-Insurance Act policy disputes

Sixteen months on from the Insurance Act 2015 and we are yet to see the provisions litigated in the courts. However, 2018 will almost certainly see post-Act policy disputes. Here are our predictions of the top seven most likely causes:

  1. How will insurers evidence what they would have done when seeking to apply a proportionate remedy?
  2. What is considered deliberate or reckless, is it something less than fraud?
  3. Excess layers may argue that the loss has not attached to their layer in circumstances where a proportional remedy has been applied.
  4. The scope of a fair presentation/reasonable search/knowledge is unclear and corporates and brokers may be exposed to non-disclosure points.
  5. Assessing what is a reasonable time and when sums are "due" for the purposes of a claim for damages for late payment may be problematic.
  6. The application of section 11 of the Act is fraught with difficulty and a lot of time and costs may be expended in arguing which terms fall within section 11 and which do not.
  7. The market has been flooded with bespoke wordings that, if examined by the courts, may result in an interpretation that was not as intended.

Given the large variance in factors that need to be considered here, it can only be helpful for the industry if some of these points are addressed by the courts in 2018.