Avoiding insurance disputes if there is a ‘no-deal’ Brexit

Posted Mar 26, 2019.
Among the raft of existing technical, legal and operational concerns that businesses have as the UK gets closer (in theory at least) to leaving the EU, UK businesses should also be reviewing their insurance arrangements and reporting to help avoid future insurance disputes post-Brexit.   

If a ‘no-deal’ Brexit is the result, there is a real danger that companies that have not properly prepared for such an outcome could face major liability risks. It is vital that businesses make sure that their individual Brexit strategies are fully and clearly documented, as failure to do so could see a range of claims from investors if a business’s performance is adversely affected. In addition, a ‘no-deal’ Brexit could expose limitations in a company’s D&O (Directors & Officers) insurance cover, potentially leaving individual Directors themselves exposed to claims. Listed businesses also need to check that as well as their insurance cover actually remaining in-force, that their ‘no-deal’ planning and preparation is commensurate with similar other businesses’ to mitigate the threat of legal action and claims in the future.

Document and disclose

Businesses are being advised to investigate, document and disclose information in a number of key areas, including:

Specific Brexit concerns that have led a company to take out insurance
Any unusual or business-specific circumstances that may alter the risk for existing insurance policies such as product liability or business interruption
Any changes to the ‘fair representation of risk’ information that is supplied when taking out or renewing insurance cover

In summing up the potential risk to UK businesses, Bruce Hepburn of insurance consultants Mactavish said:

“The insurance risk associated with a bad Brexit facing many British companies is huge, and most companies have not acknowledged this properly.  Brexit brings a host of new challenges for British business, and commercial insurance policies – including D&O cover – are bound up in a labyrinth of inter-connected policy definitions, policy triggers and cost categories, so it’s difficult to understand what they are covered for in the event of bad Brexit. In light of this they need to review their existing cover to ensure it is adequate.”

Professional help with Insurance Disputes

At Bakers Solicitors, disputed claim cases are dealt with on a no win, no fee basis. There is no upfront or unexpected costs, so if you feel you have been treated unfairly by an insurance company please contact us today for friendly and professional assistance. You can contact us by email, arrange a free consultation online or ring us on FREE on 0800 731 7284.