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George Stobbart

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EU Referendum

The committee discussed the issues in the market following the result of the referendum including the importance of access to the EU market for the insurance industry.  BIBA would be working with all stakeholders to gauge opinion and form a Manifesto position for 2017.

Case Law

The committee discussed and reviewed the following cases –

Kennedy v Cordia Services – employer found negligent for case when carer, with inadequate footwear, slipped on snow when visiting a client’s house.

Campbell v Gordon – Appellant tried to sue Gordon who was the director of a joiners.  Appellant had suffered injury whilst using an electric saw, but the EL policy had an exclusion of use of woodworking equipment, so claim was unsuccessful to EL insurer.  Supreme Court held, narrowly, that director does not have a civil liability for arranging incorrect EL cover.


The committee were advised that the Department for Transport (DfT) were receiving Francovich claims as a result of the Vnuk case.  BIBA understand a DfT consultation will be issued soon.

BIBA have written directly to Lord Hill, the EU commissioner, and he is supportive of our position.


BIBA sit on the ELTO board and ELTO have raised the question as to whether they should consider creating an equivalent database for Public Liability.

The committee felt that there is an extra level of complexity, compared with EL, given the differing triggers in PL wordings.

BIBA will ask the ELTO Advisory Board the rationale behind this request

The post Liability & Accident Committee Meeting Digest 7/7/2016 appeared first on British Insurance Brokers' Association.


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Case Law

The committee discussed and reviewed the asbestos case of Heneghan v Manchester Dry Docks in relation to apportionment of damages and the case of Mohammed v WM Morrison Supermarkets in relation to vicarious liability.


The committee were advised that the Department for Transport (DfT) were receiving Francovich claims as a result of the Vnuk case.  BIBA understand a DfT consultation will be issued soon.

BIBA have written directly to Lord Hill, the EU commissioner, and he is supportive of our position.

Under-insurance Guide, Insurance Act Guide and Technical Roadshow

The Under-insurance guide was in a draft format and the committee were thanked for their input.

The Insurance Act implementation guide was in the course of being written in conjunction with Mactavish and will be launched at the 2016 conference, with a series of technical roadshows on the Act to follow.

Any Other Business

A query was raised in relation to the FSCS and an engineering firm that had been nationalised – it was confirmed that the FSCS did not apply pre-1972.

Committee feedback to the ELTO advisory board was requested.

A discussion was held in relation to the recent issues surrounding tumble dryer fires covered in the press.

The post Liability & Accident Committee Meeting Digest – 22 March 2016 appeared first on British Insurance Brokers' Association.


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Case Law

The committee discussed and reviewed an Australian asbestos case where the illness manifested itself 5 to 10 years after diagnosis.

Lydia Graves v Marinus Gerardus Brouwer (2015) was also discussed in relation to causation.


The committee were advised that EU Commissioner Lord Hill’s office were reviewing the case and there may possibly be a slight change to the EU Motor Directive to minimise the impact, possibly in relation to vehicles used in traffic which would largely alleviate UK concerns and deal with the Motor Sport issue.

Changes to Sentencing Guidelines for Health & Safety Offences

The chairman reported on these changes which come into effect in 2016 which will result in a substantial increase in fines and associated legal costs.  The chair agreed to issue a technical briefing for members.

Any Other Business

The 2016 BIBA Manifesto ‘Fairness for All’ was discussed together with the new BIBA guides being planned on under-insurance and an Insurance Act implementation guide.

The post Liability & Accident Committee Meeting Digest 3/12/2015 appeared first on British Insurance Brokers' Association.


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The committee discussed the DEFRA report and felt insufficient people had been surveyed and there was concern about FloodRe availability in the broker market.

Software houses feedback on progress to FloodRe access was discussed.


BIBA have produced a document on the issues that the industry faces and highlighting the importance of access to the EU market.

Under-insurance Guide

BIBA has produced three guides on this topic, a main guide, mini guide and customer facing guide which were distributed to the committee and will be made available to all members.

Any Other Business

The new Riot Compensation Act 2016 was discussed, along with the court case of Mayor’s Office for Policing and Crime v Mitsui Sumitomo 2016 where the Supreme Court ruled that insurer’s losses for business interruption claims, following damage to the Sony warehouse in the 2011 London riots, were not recoverable under the Riot (Damages) Act 1886.

Insurance Act Presentation

David Hertzell, the former law commissioner, and consultant to Mactavish gave a presentation to the committee on the Act, followed by a lively discussion.



The post Property Committee Meeting Digest – 13 July 2016 appeared first on British Insurance Brokers' Association.


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DEFRA Flood Survey

The survey had now been issued – 25,000 small businesses unable to access flood cover.  DEFRA were looking to repeat the survey.  BIBA are seeking a commercial solution for flood risk properties.

Insurance Act 2015

BIBA are working on issuing an Implementation Guide, including a smaller guide for the customer.  The committee reiterated that it was hoped that insurers and brokers would work together to provide some clarity when the Act comes into force.

The question of convictions spent under the Rehabilitation Act was discussed in relation to the Act and also declaration-linked (non-average) Business Interruption in relation to proportionate remedies.

Insurance Provision in Finance Agreements

The Loan Market Association (LMA) had produced a standard broker letter which is a significant burden on insurance brokers – the letter is often produced at the last minute, cover needs to be agreed with insurers and very often the letter is in a different format.

It was agreed that a sub-committee would look to meet with the British Bankers Association and the British Property Federation and frame a response to the LMA’s letter.

Reporting Mandates

BIBA was looking to re-engage with the ABI to ensure the standard format remains fit for purpose and also look to engage with the Managing General Agents Association.

ABI/BIBA Vulnerable Customer Code

BIBA and the ABI were working together to produce a code.  BIBA would also ensure that a brokerASSESS module was available for staff training on the code.

Index-Linking of Sums Insured

The approach by insurers varies, but coupled with the rise in IPT resulted in a 9%-10% increase in property premiums.

Terrorism Insurance on Household

In response to a member query the committee view was that this was a standard exclusion, other than some high-net worth policies, and the Government would be the compensator.  There is also a commercial solution available in the market.



The post Property Committee Meeting Digest 9/3/2016 appeared first on British Insurance Brokers' Association.


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Insurance Act 2015

The committee discussed some insurers ‘early’ adoption of the Act and the view was that there were a number of inconsistencies in insurers approach and it was hoped that insurers and brokers would work together to provide some clarity when the Act comes into force.

Loan Market Agreements

The Loan Market Association (LMA) were looking to produce a standard broker letter which is a significant burden on insurance brokers – currently finance institutions issue their letter at the last minute, cover needs to be agreed with insurers and very often the letter is in a different formats.

It was agreed that a sub-committee would look to meet with the British Bankers Association and the British Property Federation.

Reporting Mandates

BIBA was looking to re-engage with the ABI to ensure the standard format remains fit for purpose and also look to engage with the Managing General Agents Association (MGAA).

ABI/BIBA Vulnerable Customer Code

BIBA and the ABI were working together to produce a code.  BIBA would also ensure that a brokerASSESS module was available for staff training on the code.

Index-Linking of Sums Insured

The approach by insurers varies, but coupled with the rise in IPT resulted in a 9%-10% increase in property premiums.

Terrorism Insurance on Household

In response to a member query the committee view was that this was a standard exclusion, other than some high-net worth policies, and the Government would be the compensator.  There is also a commercial solution available in the market.

The post Property Committee Meeting Digest – 25 November 2015 appeared first on British Insurance Brokers' Association.


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The provisional liquidator of Gibraltar-based insurer Enterprise Insurance Company PLC has today issued an important statement to brokers who placed business with them. Please click here to read the statement.

The Financial Services Compensation Scheme (FSCS) has issued a notice aimed at policyholders of Enterprise Insurance Company PLC. Please click here to read the notice.

Any queries regarding the process for compensation payments from the FSCS should be directed to them in the first instance.

Kind Regards

Steve White
BIBA, Chief Executive

The post Enterprise Insurance Company plc – Important update for members appeared first on British Insurance Brokers' Association.


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26th September 2016

Registration is now open for this year’s BIBA Scotland conference at the Inchyra Hotel & Spa, Falkirk on 3 November.

The insurance community in Scotland will come together to debate the key issues, extend knowledge and do business – and as a BIBA member broker we are offering you and all your broking staff complimentary entry.

Alongside a full programme of conference sessions you and your colleagues will be able to do business in the biggest ever BIBA Scotland exhibition of 44 exhibitors – all at no cost.  Find out more and register your place here.  We hope to see you there!


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We are aware that brokers are experiencing some issues invoicing their clients as a consequence of the  SSP outage. SSP’s Credit Control team have a very close working relationship with their broker network and are  happy to confirm that they will show flexibility on credit terms where an SSP brokers is experiencing an issue as a direct consequence of the SSP outage. SSP will do all we can to help and support brokers in these circumstances.

The post SSP Update appeared first on British Insurance Brokers' Association.


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Lords Select Committee on Financial Exclusion – Call for Evidence     

The British Insurance Brokers’ Association (BIBA) is the UK’s leading general insurance intermediary organisation representing the interests of insurance brokers, intermediaries and their customers.

BIBA membership includes just under 2,000 regulated firms, who employ more than 100,000 staff.  General insurance brokers contribute 1% of GDP to the UK economy, they arrange 54% of all general insurance and 78% of all commercial insurance business. Insurance brokers put the client’s interests first, providing advice, access to suitable insurance protection and risk management.

Thank you for the opportunity to contribute to the Committee’s understanding of access to insurance; answers to the questions set out in the call for evidence are included below.

Q1.      Is financial exclusion the inverse of financial inclusion and, if not, how do the two concepts differ? What are the causes of financial exclusion?

Insurance pricing is risk-based with those posing the highest risk contributing more in to the risk pool by way of a higher premium, or customers being declined because the risk is too high or not properly understood by an insurer who is not specialist in that particular area of risk or does not possess the relevant knowledge. Whilst there can be risk-factors which may result in these individuals failing to find appropriate cover, it is not necessarily because the risk is uninsurable; often it can be because they are not going to the right insurance provider. The recent popularity of price comparison websites (PCWs) has resulted in a ‘computer says no’ scenario for many non-standard risks. More often than not, specialist insurance brokers can place these risks. Lack of knowledge of where to go for non-standard insurance means perceived exclusion has the same effect as actual exclusion. Appropriate signposting to providers who can help is one way this can be avoided.

Q2.      Who is affected by financial exclusion? Do different sectors of society experience financial exclusion in different ways? To what extent, and how, does financial exclusion affect those living in isolated or remote communities?

Examples of exclusion include, but are not limited to:

  1. Criminal convictions
  2. Northern Ireland conflict-related convictions
  3. Pre-existing medical conditions with travel insurance
  4. High flood risk in property insurance
  5. Older people with travel and motor insurance

BIBA has been able to successfully work with Government and other industry stakeholders to provide cover to groups such as these. Specialist brokers can provide cover to those with criminal convictions and we have worked with the Office of the First Minister in Northern Ireland to provide insurance to those with convictions related to the conflict in NI. We have several members who specialise in offering cover for people affected by terminal illness or cancer – allowing them to travel abroad, sometimes for the last time. Our flood specialist brokers have helped many customers who thought they could not get cover when they were turned away from price comparison websites and we have signed an agreement with the Government Equalities Office and the Association of British Insurers on insurance for older people. The agreement launched jointly with BIBA and Teresa May when she was Home Secretary in April, named ‘Transparency and access in motor and travel insurance for older people: An agreement on age and insurance’ is a condition of membership of both the ABI and BIBA. It mandates that if you’re not able to offer cover to an older person based on their age, that insurance provider should signpost them to someone that can help. More often or not, that customer is signposted to the Find a Broker service operated by the not-for-profit trade body BIBA. The service has helped over 243,539 older customer access insurance in the last four years.

Q3.      What is the relationship between financial exclusion and other forms of exclusion, disadvantage or deprivation? What role does problem debt play in financial exclusion?


Credit rating is one of the important risk factors used in motor insurance. This can provide several indicators such as likelihood to pay monthly premium instalments and propensity for fraud. In terms of motor insurance, employment status is also used, as insurers understand those who are employed are more likely to keep the vehicle in a roadworthy state – reducing the risk of accident.

Q4.      Do individuals with disabilities, or those with mental health problems, face particular issues in regard to financial exclusion?

In terms of motor insurance, cover cannot be refused based on a disability if the DVLA are satisfied as to the health of a driver and have issued a driving licence. In terms of travel insurance, 80% of claims are for medical care; therefore health plays an important role in determining risk. As mentioned above, specialist insurance brokers with expertise of complex conditions can often place these risks where price comparison websites fail. An example of this can be found in our Manifesto where a BIBA broker was able to find travel insurance for 120 WWII veterans to travel to Arnhem to attend a service to commemorate the Liberation of Arnhem in 1945.

A second example is also in the manifesto where a terminally ill man, Jason Liversidge, with both Motor Neurone Disease and Fabry disease could not find the cover needed to travel to Disney World with his family. BIBA’s Find a Broker service was able to step in and find the insurance they needed with a competitive premium (see video of Jason and Liz Liversidge explaining in their own words how they struggled, then found the cover they needed https://www.youtube.com/watch?v=Ok0nxOtVD1c).

Q5.      Are there appropriate education and advisory services, including in schools, for young people and adults? If not, how might they be improved?

Q6.      How can financial literacy and capability be maintained and developed over the course of a person’s lifetime?

Q10.    How effective has Government policy been in reducing and preventing financial exclusion? Does the Government have a leadership role to play in addressing exclusion?

We have chosen to answer questions 5 and 6 and 10 together.

There is very little in the way of financial education the takes place in schools and few other bodies who work broadly on helping the public understand how insurance can help them protect themselves and their assets.

Following the Government decision to close the Money Advice Service, identifying gaps in the financial guidance market is a relevant objective for the replacement money guidance body.

BIBA would like to propose themselves as a relevant third party who could assist in this area. As described above, BIBA is a not for profit Trade Association who run a general insurance Find-a-Broker service which helps over 250,000 general insurance customers access insurance every year.

More often than not these queries relate to gaps in the financial guidance markets where customers with unusual or non-standard risks have been unsuccessful in finding suitable insurance solutions in the general market. This is often because they find ‘the computer says no’ – this concern was raised in the FCA Occasional paper 17, Access to Financial Services in the UK in May 2016 as a barrier that can exist for consumers trying to access financial services in the UK.

Another barrier that was raised in this same paper was that 3.8 million UK households are without any internet but also 12 million people live in rural or remote areas of the UK with poor internet access. This same paper also highlights 3 million people with disabilities who have been turned down for insurance or charged extra. This goes on to say the ‘non-standard consumer’ can find it impossible to find tailored or appropriate products.

We have formally suggested a new agreement with Government that builds on our existing and successful Find-A-Broker Service that could assist in this area.

Q7.      What role should the concept of ‘personal responsibility’ play in addressing financial exclusion? Is appropriate support available for the most excluded and, if not, how should support be strengthened? What role should Government, the charitable sector and business play in tackling financial exclusion?

Personal responsibility is a key part of an insurance contract as the insured has responsibilities including a fair presentation of the risk under the Consumer Insurance (Representation and Disclosure) Act 2012, as well as other responsibilities dependant on the type of insurance, regarding due care, vehicle/home maintenance and reporting incidents that may give rise to a claim. If the insured does not fulfil the responsibilities they have an insurer may not pay their claim. Brokers, acting as agent of the client under agency law, often provide guidance on the cover they are purchasing as well the responsibilities both parties have to one another. This understanding is crucial to ensuring that an insurance policy responds when it is needed and pays the claim. Brokers usually get paid by insurer via commission rather than fees, meaning that this service often does not cost more than going direct.

Utmost good faith is a positive duty voluntarily to disclose, accurately and fully, all facts material to the risk being proposed.

BIBA has also recently launched a Code of Good Practice to help vulnerable customers in conjunction with the ABI. Under the Code participating insurers and brokers will:

  • Ensure staff are adequately trained to recognise and understand potentially vulnerable customers at renewal and be able to offer flexible options to help address needs (where necessary).
  • Periodically review legacy policies to, where possible, identify vulnerable customers to ensure they are aware of any more suitable alternative products now available.
  • Ask potentially vulnerable customers at renewal if their current policy and renewal terms meet their needs, and make clear the importance of reviewing their cover.
  • Consider if additional communication, for example a telephone call, is needed to help vulnerable customers through the renewal process.
  • Ensure that the customer’s options, and how they can exercise them, are always clearly set out.

Q8.      Are appropriate financial services and products available for those who are experiencing financial exclusion? What might be done to address any deficit? What role should banks play in increasing access for those most at risk of exclusion? What is the role of the Post Office in providing access to financial services for such customers, and how might that role develop?

Many banks opt to provide insurance cover via packaged bank accounts. There have previously been issues with the way these have been sold to which led to the regulator issuing new rules to ensure that the product was suitable for the customer. The policies offered are often limited in terms of their cover compared with quality stand-alone products sold by brokers, which can be a surprise to customers when it comes to a claim.

In terms of non-standard risks which banks, the Post Office or other providers can’t place, BIBA would suggest a system of ‘signposting ‘ to the BIBA Find a Broker service in a similar way to the ‘Transparency and access in motor and travel insurance for older people: An agreement on age and insurance’ agreement mentioned aboveensuring that those distressed risks that can’t find cover are directed to someone that can help.

Q9.      What has been the impact of recent changes to the consumer credit market – such as the capping of payday loans – on those facing financial exclusion? How can it be ensured that those in need of affordable credit can access appropriate products or services?

In terms of credit, many brokers offer insurance premium finance, allowing them to spread the cost of their premium over the period of the insurance contract.

Q11.    What has been the impact of recent welfare reforms on financial exclusion?

Q12.    How effectively are policies on financial exclusion coordinated across central Government? Is there an appropriate balance and interaction between the work of central Government and the work of local and regional authorities, and the devolved administrations?

We have chosen to answer questions 11 and 12 together.

BIBA has no comment on welfare reforms specifically; however, young people aged under 25 have seen their housing benefit withdrawn. Young drivers also experience some of the highest insurance premiums.

Young drivers make up just 12% of licence holders but are involved in 25% of road deaths and serious accidents, which tend to be more expensive in terms of claims. The increased number and costs of accidents involving young drivers mean their insurance premiums are much higher.

One way to offset this could be to promote telematics insurance policies which offer discounts to the safest drivers based on their driving behaviours. This is monitored either via a smartphone app or ‘black box’ in the car measuring variables such as speed, acceleration, deceleration, G-force in corners and familiarity of route. Young drivers in particular can make significant savings as well as

Research by the Road Safety Foundation, commissioned by Ageas and in conjunction with BIBA member ingenie, showed that an Insurance Premium Tax (IPT) break on young driver telematics products would lead to safer roads and more insured drivers. It would mean a net benefit to the UK economy of £370 million at a benefit- cost ratio of more than two to one.

Further details can be found on Ageas’ website: https://www.ageas.co.uk/documents/corporate/press/IPT_business_case_FINAL.pdf




Q13.    To what extent is the regulation of financial products and services in the UK tackling financial exclusion? Are alternative or additional regulatory interventions required to address financial exclusion? What balance should be struck between regulations and incentives for financial institutions?

Q14.    Does the Government have a role to play in ensuring that the development of financial technologies (FinTech) and data capture helps to address financial exclusion? If so, what should this role be?

We have chosen to answer questions 13 and 14 together.

Brokers play a crucial role in helping customers, particularly those with non-standard risks, find the insurance they need. However, research commissioned by BIBA and carried out by London Economics shows that UK insurance brokers face the most expensive regulatory regime in the world; more than double the cost of our nearest competitor, Singapore. As well as the extra cost, the extra work generated by UK regulators stifles innovation in Fintech that can help empower customers.

The sheer weight of regulatory change in recent years from the FCA and the Competitions and Markets Authority (CMA) has meant a significant amount of IT resource has been diverted away from innovation and into compliance.

For example, a leading broker software houses advised they have had to delay developments of Mylicence – a facility to automatically check DVLA’s driver licence records, and Flood Re to ensure compliance with the CMA protected no claims bonus (NCB) rules that begin in August this year as they require major systems changes.

They reported to us that new regulation CMA and FCA regulation required them to spend an additional 4,000 hours of work in ensuring compliance. BIBA would argue that something like Flood Re is far more important for customers in flood risk areas; however, because the new CMA protected NCB rules is a legal regulatory requirement we have no choice as an industry but to focus on regulation as the priority. This resulted in few brokers being able to utilise Flood Re when it launched on 4 April – ultimately meaning fewer customers can access affordable flood insurance.

The FCA’s forthcoming changes to split out add-ons into more detail and to show last year’s renewal will also take up front line resources and mean innovations such as Mylicence get pushed further down the agenda.

The UK is already the most expensive regulatory system in the world. Some of BIBA’s largest members pay comfortably over £1 million in regulatory fees and our members pay collectively over £28 million for their direct cost of regulation, but then even more than this again to ensure compliance with this constant flow of new requirements from our regulators.

At the moment we have seen no benefits from the Government’s red tape challenge and in fact for 2015-16 saw a 8.4% increase in the direct cost of regulation.

We would recommend to the Committee that now the Enterprise Act has received royal assent, that Government strongly enforce part 2 of the Bill regarding a regulators performance report and the duty to report on the effect on economic growth of regulation ‘Red Tape’.  Crucial to this helping our industry this is ensuring the FCA is confirmed as one of the designated regulators under the secondary legislation.

BIBA would be very happy to give oral evidence to the committee and we are happy to invite any committee members to come and visit the call centre to see how we can help the financially excluded to access insurance.

Yours Sincerely

Graeme Trudgill, FCII
Executive Director
0207 397 0218

The post BIBA response to the Select Committee on Financial Exclusion appeared first on British Insurance Brokers' Association.


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SSP have temporarily adjusted its system configuration to allow affected brokers to clear Private Car, Home, Commercial Vehicle and Motorcycle renewals that were impacted by the system outage.

They have had a number of insurer request a short extension to the 17th September revert date, so they will  be removing the temporary system configuration at the close of business Monday 19th September.

As you’ll appreciate this is a unique set of circumstances and SSP are working hard to minimise the impact on you.

The post Latest SSP update appeared first on British Insurance Brokers' Association.


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BIBA members are reminded that if they hold or control funds or economic resources belonging to, owned, held, or controlled by a designated person that they are required to submit a report to the Treasury’s Office of Financial Sanctions Implementation (OFSI) by Friday 14th October 2016.

Reports should include details of all funds or economic resources frozen in the UK as well as those overseas where these funds or economic resources are subject to UK financial sanctions legislation.  Reports to OFSI should include the value of all such assets as at close of business on Wednesday 30th September 2016.

All completed reports should be emailed to ofsi@hmtreasury.gsi.gov.uk using the template on the GOV.UK website.  For further information click here.

BIBA members’ compliance and regulation queries should be directed to: compliance@biba.org.uk

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9th September 2016

In its response to the Government’s consultation on autonomous vehicles – Pathway to Driverless Cars – the British Insurance Brokers’ Association (BIBA) sets out what it and its members believe to be the top four issues to be addressed. The key priorities are centred on the need for insurance to continue to be provided from within the insurance sector to give vehicle users protection and security from a highly competitive market.

Four key priorities
Firstly, a single seamless motor insurance policy should be developed that will provide indemnity for risks that will include failure of the autonomous vehicle however caused, including by cyber-attack.

Secondly, in order to support claims and insurance policy transferability it will be essential for customers and their insurance brokers to have immediate and unrestricted access to all data from the autonomous vehicle manufacturer and that the data be provided in a standard, clear, accessible format.

Thirdly, given the changing risks that will emerge, insurers must have clarity over their rights of subrogation against a manufacturer whose vehicle may have been at fault. At law, manufacturers in these circumstances should not be able to use a ‘State of the Art’ defence to avoid damages.

Fourthly the autonomous vehicle driver or user will need to have recourse under the Road Traffic Act to be able to claim on their own insurance policy to receive compensation should they sustain any injuries that are caused by a vehicle defect and sustained whilst it is in fully autonomous mode.

Graeme Trudgill, Executive Director at BIBA said; “This is a really important consultation document that takes a first look at the tumultuous change that is likely to be brought about by the development of driverless car technology. It is titled a Pathway to Driverless Cars and as we begin this journey it is vital that all of the various stakeholders can set out their priorities and table any issues that might ultimately impact customers. This is an exciting time of radical development for motor insurance providers and brokers and, although we have set out here our key issues there are many other considerations to be addressed. BIBA is already working closely with the Department for Transport to ensure our members’ views and those of their customers are represented.”



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Pathway to Driverless Cars:

Proposals to support advanced driver assistance systems and automated vehicle technologies 8.9.16

What we are proposing


Question 1A: Do you agree with the proposal to review the regulatory framework to enable the use of advanced driver assistance systems and advanced vehicle technologies as they come to market in the UK? * Yes


It is important that the regulatory framework, including the Road Traffic Act and Highway Code, are suitable for the long term implementation of fully autonomous vehicles on the UK’s roads.


We would like to make a distinction between levels 0,1,2,3 and levels 4 and 5.


We believe levels 0,1,2,3 are catered for by the existing legal system of subrogation, where an Insurer can recover their claim payment from the motor manufacturer, garage, dealer, vehicle repairer, if it were proven they were negligent in regard to the proximate cause of the claim.


This system means the customer enjoys protection by the RTA Insurers and is also compensated by the RTA Insurer for payments to third parties, passengers and accidental damage to the vehicle (where comprehensive cover is selected).


The current RTA position is that the Insurer would not compensate for injuries to the driver of the vehicle they insured, even if not at fault, and it would be down to a legal expenses insurance or the customer’s legal representation to pursue the negligent third party.


With levels 4 and 5 there will need to be reform of the regulatory framework/Road Traffic Act. Here the driver/person in charge of the vehicle is in the hands of the manufacturer – in that the product they are driving is relied upon to be safe to drive. If however there was a fault with the vehicle, then we must see a different framework which delivers robust protection for the customer.


It would be very difficult for the driver/person in charge of the vehicle to establish a fault with the car and take the manufacturer to court. Therefore we would wish to see a change implemented to a motor insurance policy, which would provide compensation to the driver or person in charge of the vehicle for injuries they sustain, and then the Insurer could seek to subrogate from the manufacturer.


It is important that the driver/person in charge would also receive compensation where a vehicle fails in autonomous mode and the driver takes back control of the vehicle but is still unable to prevent the incident.


Current UK law, the Motor Vehicles (Compulsory Insurance) Regulations 1992 and the Employers’ Liability (Compulsory Insurance) Exemption (Amendment) Regulations 1992, is that liability for injury to passengers travelling in motor vehicles arising out of and in the course of their employment fall under motor policies where the liability is an RTA liability.  Consideration of similar protection for the driver/person in charge of an autonomous vehicle being injured in the course of his employment must also be made.


In this regard it is also vital that the customer, their agent and the insurer are permitted unrestricted and immediate access to the information and data from the vehicle, this information should be in a standard, clear, accessible and consistent format. This would be similar to now, where a motor engineer’s report would confirm if the vehicle had brake failure etc. and is important evidence in establishing negligence. This is important as there is a concern over how willing the manufacturer would be to provide an admission of liability. This would ensure a potential block to justice is prevented. E.g. it took Vauxhall some considerable time before they accepted the issues surrounding the Vauxhall Zafira engine fires. The customer should not be left without compensation as they cannot access, what we would say is, their own data.


It is also important that vehicle manufacturers are not permitted to use the ‘State of the Art’ defence to try to deny these claims, so the law must be clear in these cases too.




Question 1B: Do you agree that we should follow a rolling programme of regulatory reviews? * Yes


With the implementation of new technologies and/or methods of using said technologies, it would be prudent for the Department for Transport to periodically review the regulations to ensure that they were fit for purpose and took into account any changes that may have happened since the last review. We would suggest this is done on a regular basis and completed with input via consultation.


These reviews should apply to both the Insurance sector and the vehicle manufacturers and repairers.


Question 1C: In the first wave of regulatory change, with the exception of insurance, should we only consider those advanced driver assistance systems or automated vehicle technologies that are likely to come to the UK market in the next 2-4 years? * Yes


If a rolling programme of reviews were to take place as per Question 1B, this would mean that the Government and respective industries involved with autonomous vehicles would only need to consider technologies likely to come to the UK market. This ensures that the focus of the Government and respective industries is on those technologies UK motorists are most likely to be using.


However as vehicles will be visiting the UK from overseas the Government will still need to be mindful of foreign vehicles with this technology being driven on UK roads.


Question 1D: Are you aware of any upcoming advanced driver assistance systems or automated vehicle technologies which this document does not cover? * Yes Which systems?


We have been made aware of developments surrounding voice control and gesture controls which were not part of this consultation.

Insurance A proportionate response


Question 2A: Do you agree with the proposition to amend road vehicle compulsory insurance primary legislation in Part 6 of the Road Traffic Act 1988 to include product liability for automated vehicles? * Yes



It is vital that the innocent victim of a road traffic accident receives compensation.


For levels 0,1,2,3 we believe the existing legal situation is acceptable.  However for levels 4 and 5 we are also seeking that insurers provide indemnity for losses if the claim is caused by a failure of the autonomous vehicle – whether this be its sensors, programming, cyber hack or anything else.


We understand that Motor Insurers are agreeable to insuring these risks in a standard motor policy and then would seek to subrogate from the negligent manufacturer/ repair garage/ dealer. Therefore it is vital that motor manufacturers share openly with their customer/customer’s broker/ customer’s agent/ customer’s Insurer all the data openly and honestly in order to establish the cause and any culpability. It is also important that manufacturers are not allowed the ‘State of the Art’ defence to try to deny these valid claims.


Products liability insurance policies in their current form are not suitable and are limited in award (which is a challenge considering the current requirement for unlimited personal injury cover under the RTA) and it would therefore be necessary for Insurers to design entirely new products.


The current insurance model was not designed with autonomous vehicles in mind and, should there be a collision with a vehicle employing AVT and that vehicle was at fault; liability would most likely be attached to the manufacturer of the technology that failed, rather than the driver. Therefore for levels 4 and 5 motor Insurers would need to cover these risks and subrogate from the manufacturer and their product liability insurance (or self-insurance).


Therefore the Government should consider legislating to ensure that motor vehicle manufacturers have in force appropriate liability insurance that will respond to claims for autonomous vehicles that may arise in the future, or hold sufficient reserves to be able to indemnify those claims that are being subrogated against them by Insurers.



Question 2B: What, if any, other changes to the insurance framework should be considered to support use of AVT? Why?



Motor policies on-the-whole do not specify cyber cover and this would also need to form part of any changes to a policy for an autonomous vehicle, making it clear that the motor Insurer would indemnify and then seek to subrogate from the negligent party.


Insurance has always been there to compensate the innocent third party. Should a disagreement regarding liability occur between an Insurer and vehicle manufacturer, this would be detrimental to the third party as it may delay the payment of their claim. Therefore, a seamless insurance policy, that would make motor Insurers statutorily liable for accidents while in autonomous mode, would be most suitable for a customer (even if the incident was caused by cyber / product failure) and then allow subrogation against manufacturers.

There would also need to be a model in place to take account of failure due to an error from the garage/dealer/repairer/ service organisation including sufficient limits of indemnity to provide compensation.


We also believe the insurance requirement should remain the responsibility of the ‘user’ which is why we do not think that the manufacturer should deny any claim if the vehicle owner had not uploaded the latest upgrade as this would be out of the hands of the user (see our reply to 2H).


We believe that this model would allow for free competition in the motor insurance market, allowing customers to choose where they buy their insurance and have the necessary protections in place.

The benefits and impacts of changing insurance for automated vehicles


Question 2C: If you are an insurer, vehicle manufacturer or other organisation directly affected by these changes, what costs do you estimate your organisation will incur as a direct result of these changes?


There is a concern within the insurance industry that motor manufacturers will retain information generated by the driver/vehicle and will either enter the motor insurance market with exclusive partners, or charge a premium to access this data. We strongly believe that this would be anti-competitive, uncompetitive and that the data is owned by the customer and should be accessible by the owner of the vehicle or their agent. This would enable the owner to shop around for insurance and help to keep claims costs down – ultimately reflecting in lower premiums. We also believe there is no difference from the current system of Insurers accessing technical reports on the reasons for conventional vehicles failing today.


Question 2D: Do you anticipate the cost of insurance products for vehicles with AVT to be higher than for conventional vehicles? * * No By how much and why?


Currently, 90% of accidents are caused by human error. Therefore, claims frequency should be much lower for vehicles with AVT; however, this must be balanced with the potential increased cost of claim for repair as there will be many technologies, such as expensive sensors, that could be damaged in a collision and may need to be replaced.


The UK motor insurance market made a £31m underwriting loss in 2014 and it last made an underwriting profit in 1994 (source: ABI Key Fact Guide).


We expect there to be more people in an autonomous car, making fewer journeys, ultimately there could be fewer physical vehicles on the road.


Overall, our members expect the total claims cost caused by human error to be dramatically reduced with autonomous vehicles. However, higher damage repair costs and the introduction of a cyber element will offset some of this. We anticipate slightly higher premiums to start with, but a potential reduction over time as the market learns and adjusts with the availability of claims data for actuarial review and the technology becomes more reliable. Therefore in the longer term we anticipate premiums for autonomous vehicles could be less than for a similar conventional vehicle.


Question 2E: Do you anticipate the introduction of vehicles with AVT to increase insurance premiums for conventional vehicles? * No Why?



Once there is a critical mass of vehicles with AVT on the roads, conventional vehicles may also benefit from lower accident rates, therefore lower premiums in the longer term.


Question 2F: What do you estimate the costs will be to insurers, vehicle manufacturers, or other parties of providing product liability cover for automated vehicles, and why?


As these are emerging technologies, there is a lack of actuarial data on which to base price.


There is also a significant build cost for the insurance industry to ensure the infrastructure and products are in place.


Therefore, premiums may be cautiously high initially; however as claims rates/exposure is more understood and there is more availability of products in the market, premiums should start to fall as per 2E


Question 2G: Do you anticipate that this cost will be passed on to the consumer * Yes Why, and by how much?


New Product Liability and Cyber Insurance elements of cover would likely be priced into the motor  insurance policy sold to owners of vehicles with AVT; therefore the customer would benefit from a potential lower accident rate compared to a conventional vehicle, but the cost of this insurance would be passed on to the customer as they pay the premium.


Insurers would also need to consider their ability to recover losses from vehicle manufacturers and also the solvency of vehicle manufacturers, when pricing insurance for an autonomous vehicle

Failure to maintain automated vehicle technology, inappropriate use, and circumventing automated vehicle technology


Question 2H: Do you agree that where a driver attempts to circumvent the automated vehicle technology, or fails to maintain the automated vehicle technology, the insurer should be able to exclude liability to the driver but not to any third parties who are injured as a result? * Yes  Why?


There are two separate issues here, the innocent and the deliberate circumstance when someone has adjusted the AVT.


The proposal would involve amending the current section 148 of the Road Traffic Act regarding avoidance of certain exceptions or securities, but we agree this would be preferable as it would keep the consistency with conventional vehicles that are on the road where a driver is at fault.


So what we would like to see is the innocent third party compensated, but no accidental damage cover for the customer, if they have purposely tampered with their autonomous vehicle deliberately and against manufacturer’s instructions – unless agreed prior to the change.


We also believe that customers must be given sufficient time to update their software and numerous warnings given before any cover is invalidated. Our expectation is that the insurance must have an element in it that will ensure the policy is not invalidated just due to a late software update. Customers must not be prejudiced in these situations.


One further consideration is that new vehicles are only required to submit to an annual MOT after the initial 3 years. With this new technology the DFT may want to consider if this is an appropriate period for AVT vehicles.

Third party hacking


Question 2I: Do you agree that in the event of 3rd party hacking of an automated vehicle, an insurer should not be able to exclude liability, as set out in the Consultation Document? * Yes  Why?


An amendment to the Road Traffic Act would be needed and this would bring vehicles with AVT in line with conventional vehicles.


Although cyber is a developing market with little actuarial information on which to build products, it is crucial, certainly in the case of AVT, that a separate standalone cyber policy would not be the answer and cyber risks should be part of the overall motor insurance policy.


It is likely the effectiveness of the software/firmware in preventing hacking could become one of the rating factors of the vehicle.


Cyber risks should be covered under the motor policy, however if there is a mass cyber-attack from a terrorist or similar type of organisation, taking control of numerous vehicles, then this would need further consideration by the Government in line with other terrorism pooling arrangements .

Product liability and automated vehicles


Question 2J: Do you agree that the product liability and insurance requirements for automated vehicles should:

  • follow the normal rules on product liability with different rules depending on whether the injured party was an individual or a company? ** No
  • be limited by the ‘state of the art’ defence, as set out in the Consultation Document? * No Why?


There should not be any disparity between conventional vehicles and autonomous vehicles on the road. Where a vehicle has been involved in a collision and is at fault, the RTA currently provides that innocent parties are compensated. All types of risk – whether they be failure of the product or cyber should follow the same precedent regardless of if the injured party was an individual or a company.


It is hugely important that the ‘State of the Art’ defence should not apply to product liability for autonomous vehicles. It is important that the innocent party is compensated, whether due to the fault of the driver or vehicle. As we are considering RTA risks, we must remember the reasons the RTA exists and not allow manufacturers any way of not fulfilling their responsibilities in reimbursing Insurers for claims they have paid out for an innocent/injured party. Any manufacturer willing to put autonomous vehicles on the road should take full responsibility for them and be willing to compensate Insurers for their outlay.


Question 2K: Alternatively, should we extend insurance/liability rules specifically for automated vehicles? * Yes Why?


As per 2J


Public sector vehicles


Question 2L: Do you agree with the proposal that, with respect to automated vehicles, the public sector can continue to self-insure but, where they choose to self-insure, they would then be required to step into the insurer’s position in respect of product liability damages? * Yes  Why?


This should replicate the current situation with regards to conventional vehicles.


An alternative option: a first party insurance model


Question 2M: Do you agree that an alternative first party model option would not be proportionate while automated vehicles represent a small proportion of the fleet? * Yes * Why?


The first-party insurance model may not allow Insurers to control costs and could introduce much more litigation to the system, potentially increasing premiums by a significant amount. However, we think a hybrid system is suitable where the Insurer could indemnify the user/driver/ person in control of the autonomous vehicle and then recover from any negligent manufacturer.


Question 2N: What do you anticipate the cost of implementing a first party insurance model would be?


Difficult for the broking community to advise.


Next steps


Question 2O: Do you have data to support your answers on insurance for automated vehicles?


Not at this point in time.


Highway Code and Construction and Use Regulations Highway Code ADAS guidance


Question 3A: What are your views on amending the text of the Highway Code in a way that would clarify rule:

  • 150, related to use of driver assistance systems and distraction?
  • 160, relating to driving with both hands on the wheel?


These rules could be amended, however it would need to be made clear that this was for autonomous vehicles in full autonomous mode so as not to introduce the unintended consequence of encouraging bad driving behaviour. Perhaps this could be done with a separate section in the Highway Code for autonomous vehicles to avoid confusion.


Enabling platooning


Question 3B: Do you agree with the proposition to allow platooning by relaxing Highway Code rule 126 (which recommends a 2 second gap between vehicles)? * Yes * No Why?


To gain the maximum fuel efficiency benefit of platooning (in terms of aerodynamics), the gap should be decided by what is deemed to be the safest distance and this reflected in the Highway Code.


Question 3C: What, if any, other restrictions should be considered regarding use of platooning technologies, and why?


Platooning works best when there are fewest variables and increased predictability of behaviours. Platooning would not be suited to roads where pedestrians have access; therefore our suggestion is that platooning is limited to motorways only.


On motorways at present there are sometimes problems when trying to take the exit at busy times, with slower moving HGV’s preventing access to the inside lane. The technology would need to be adapted so that this would not be a problem for platooning vehicles.


Consideration should be made to allow ‘undertaking’ of autonomous HGV’s platooning on motorways where they are in the middle lane.

In France there is a requirement for HGV’s to leave a gap of at least 50 metres although this is not always complied with.


Driver disengagement/re-engagement following platooning/autonomous driving is an area where it is essential that the technology asks for affirmative action by the driver to take control and, if no response is received within a defined timescale, the vehicle safely pulls in and stops. Such action could then act as an indicator of liability, should an accident occur, as to whether the vehicle or driver/person in charge was in control at the time.

Freeing the driver to make use of the automated vehicle


Question 3D: Do you agree with the proposition that specific and implied driver distraction restrictions are not relaxed at this time? * Yes Why?


A number of different autonomous vehicle providers have different levels of automation. For example, Tesla’s Autosteer function “requires drivers to remain engaged and aware when Autosteer is enabled. Drivers must keep their hands on the steering wheel”.


Relaxing distraction restrictions before level 4 and 5 automation has been proven, and when there is a mix of AVT vehicles on the road, could confuse drivers. This also means that should automation fail in some way during the early days of this technology in the real world, the potential for the driver to intervene would be much reduced.

Construction and Use Regulations Remote control parking


Question 3E: Do you agree with the proposed approach to enable remote control parking by clarifying:

  • Regulation 104 (the driver should be in a position to be able to control the vehicle)? * Yes
  • Regulation 107 (switching off the engine when the vehicle is not attended)? * Yes
  • Regulation 110 (not using hand-held mobile phones while driving)? * Yes Why?


It is important to note that currently, should a driver leave their keys in a vehicle with the engine started such as to warm it up on a cold morning and the vehicle is stolen; this may not be covered under the theft section of a motor policy.  In fact some motor policies will exclude theft if a vehicle is left unsecure or unattended, irrespective of whether the keys are removed.


The example given in the consultation paper, that a vehicle could be remote started to warm it up, would need technologies built into the vehicle ensuring it could not be taken away by anyone other than the owner.


Motorway assist


Question 3F: What are your views on amending Regulation 109 to allow drivers to view TV/display screens displaying information that is not related to the driving task, while driving?


This should not be changed until level 4 and 5 and when full automation has been shown to work for a significant period of time. Additionally, it should be made clear that this is for whilst an autonomous vehicle is in full autonomous mode on the motorway only. There is a risk that this may encourage those who do not have full autonomous mode to have TV/display screens which would be hugely unsafe.


The benefits and impacts of ADAS


Question 3G: Do you have any data or evidence of the safety benefits of these advanced driver assistance systems?


Not at this time


Question 3H: Are there any other, non-safety, impacts (including costs) of ADAS, which we have not covered in this consultation document?


Not at this time


Question 3I: Please supply any data to support your answers.




Summary of top four issues:


  1. A single seamless motor insurance policy should provide indemnity for risks including a failure of the autonomous vehicle through levels 0-5, however caused, including a cyber-attack.
  2. Ensuring the customer and their Insurance Agent/Broker/Insurer has immediate unrestricted access to all data from the autonomous vehicle manufacturer and that the data is in a standard, clear, accessible format.
  3. Ensuring Motor Insurers have a clear and fair right of subrogation against a manufacturer– not allowing manufacturers the ‘State of the Art’ defence.
  4. The driver or person in charge of the autonomous vehicle to be eligible under the Road Traffic Act to receive compensation from their insurance company for their injuries sustained due to a defect in the vehicle whilst in fully autonomous mode (levels 4 and 5).

The post BIBA Responded to the Pathway to Driverless Cars: Proposals to support advanced driver assistance systems and automated vehicle technologie appeared first on British Insurance Brokers' Association.


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9th September 2016

The British Insurance Brokers’ Association (BIBA) has announced ‘Connections’ as the theme for its 2017 Conference & Exhibition to be held at Manchester Central on May 10 & 11.

Steve White, BIBA’s Chief Executive, commented: “We’ve chosen the theme ‘Connections’ to encompass both the challenges we face and the strengths we can demonstrate to succeed as an industry in the foreseeable future.

“We live in an increasingly inter-connected world. New build houses have the capability to be controlled by their owners wherever they are, cars and other vehicles are developing rapidly with the UK at the forefront of the driverless cars revolution. All of these advances will challenge the insurance sector to solve issues of cover and security.

“Secondly, following the Brexit Referendum decision it is vital for the UK to show the world that we are ‘open for business’. I believe insurance will be one of the pathfinder sectors to our secure trading future. Our connections to multinational insurers, customers and regulators will ensure that Britain still leads the way in the global insurance world.

“Last, but not least, brokers are the most connected players in the sector: our members’ connections in the market and all those involved in delivering insurance solutions are vital in creating and delivering customer value. The BIBA Conference is the perfect place for members to network, meet new connections and re-establish old contacts.”

Lindsay Campbell, BIBA’s Conference Organiser, added:  “Once again we are delighted to be returning to Manchester for the 2017 conference. The venue and the City’s facilities continue to deliver outstanding visitor feedback. Our conference has developed into one of the largest business events in the City.

“We are currently developing a comprehensive programme of keynotes, seminars and fringe sessions as well as working on our Young Broker Day to ensure it continues to add value to our younger members’ career development programmes.”

To visit the conference website, please go to www.biba2017.co.uk


Notes to editors

  1. For further information please contact:BIBA press office:
    Pam Quinn, Head of Communications
    020 7397 0223

Leighann Forsyth; Deputy Head of Communications
020 7397 0223


  1. About the British Insurance Brokers’ Association

The British Insurance Brokers’ Association (BIBA) is the UK’s leading general insurance intermediary organisation representing the interests of insurance brokers, intermediaries and their customers.

BIBA membership includes just under 2,000 regulated firms.

General insurance brokers contribute 1% of GDP to the UK economy and BIBA brokers employ more than 100,000 staff.

54% of all general insurance is sold by an insurance broker and they arrange 78% of all commercial insurance business.

Insurance brokers put the client’s interests first, providing advice, access to suitable insurance protection and risk management.

BIBA helps more than 250,000 people a year to access insurance protection through its Find a Broker service, both online and via the telephone.

BIBA is the voice of the sector advising members, the regulators, consumer bodies and other stakeholders on key insurance issues.


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9th September 2016

In light of recent events BIBA will be taking a lead in facilitating constructive discussions about what has occurred and necessary future action including the next steps for its members.

BIBA will be hosting a meeting between senior SSP personnel and some affected BIBA members. The purpose of the meeting will be to explore what happened and reach agreement on the next steps.

The discussions will include:

·seeking a comprehensive explanation from SSP as to the reasons behind the recent lengthy outage;
·discussion around the robustness of SSP systems and disaster recovery programmes;
·what action will be taken to avoid a similar event reoccurring and;
·exploring the next steps for members in their future agreements with SSP.

Ahead of the meeting BIBA will be seeking the views of our wider membership regarding the impact of the outage on their business and this will inform part of the dialogue during the meeting.

Steve White, BIBA Chief Executive said: “As the trade body of many affected brokers it is essential that we take the lead in navigating these issues and addressing the long term solutions on their behalf. Once the current problems have subsided we feel it is also important for all of our members that we ascertain the robustness of the systems, risk management and disaster recovery of the other leading broker software houses and this is already on our agenda.”



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