The Chancellor used this phrase in introducing the part of his budget speech that covers insurance. The budget materials point to close liaison between Treasury and the Ministry of Justice, in that they:
- announce a fundamental review of the regulation of claims management companies, reporting to both Treasury & MoJ, and
- reconfirm that the Insurance Fraud Task Force will report to both these departments by the end of the year.
The less welcome news for insurance customers is a 50+% increase in IPT (Insurance Premium Tax). In November, the rate will go up from 6% to 9.5% of premium charged.
On 2nd June Lord Alton reintroduced a Bill to attempt to impose a statutory levy on insurers to fund clinical research into the treatment of mesothelioma.
The Mesothelioma (Amendment) Bill is a private member’s bill introduced in the House of Lords by Lib Dem peer Lord David Alton. He was formerly an MP in the Liverpool area and has a strong interest in mesothelioma and asbestos diseases generally which very likely stems from experiences of constituents who had contracted such conditions. In 2011/12, Lord Alton instigated discussion in the House of Lords aimed at preserving the recovery of success fees and insurance premiums in mesothelioma claims. That led to the Government conceding the point and setting it out clearly in section 48 of the LASPO Act 2012.
The new Bill is a re-tread of identical proposals he had tabled in the last Parliament. At present, it seems quite unlikely that it will pass into law.
However, if the new Bill is debated in earnest in the Lords, those proceedings could provide some indication of whether the new administration has any appetite whatsoever to legislate in this field. For example, section 48 may well be brought to an end in due course. The previous Government had attempted to do this but lost a judicial review brought against its proposals and thus, for the time being at least, mesothelioma claims are still subject to the recovery of success fees and insurance premiums from paying parties (defendants). It follows from that that these cases should not, for as long as success fees remain recoverable, be subject to the ten percent increase in general damages brought about by the Court of Appeal’s decision in Simmons v Castle.
About the Author
Alistair Kinley is BLM’s Director of Policy & Government Affairs.
Alistair is responsible for BLM’s engagement with government departments and regulators on policy and public affairs issues and consultations affecting the firm and its customers. He coordinated BLM’s market-facing activities in connection with the Insurance Act 2015 and the consultations which preceded its publication and introduction in Parliament.
He is a member of the Civil Justice Council (CJC), a regular speaker and experienced commentator on legal and procedural reforms and was a contributing editor to the Law Society’s Litigation Funding Handbook (September 2014).