We have seen a real change in the regulatory sphere in the last two years.The Insurance Act introduced in 2015 and its last year’s amendment, The Enterprise Act 2016, which came into force on 4 May this year, has meant that some insurers and brokers have really needed to explore the impact of these changes on their businesses and, ultimately, their customers.The Insurance Act required a refresh of policy wording and processes but, for Ageas, it hasn’t resulted in a big change to the way we handle claims.We pride ourselves on our claims service and fair claims handling and the new legal environment complemented our predicament management-based ethos.
This has meant supporting our brokers throughout the process, who in turn were able to help their SME customers so that everyone understood the impact of the changes when customers had to claim.
Value
I believe, The Enterprise Act adds value and brings about positive change. It gives policyholders a right to claim damages if a claim is not paid within a reasonable amount of time.It is important to clarify here that all insurers will still have time to investigate and assess claims fairly and properly – our commercial customers shouldn’t see any difference.
To be able to recover damages for late payment under The Enterprise Act, the policyholder would need to show that it’s a valid claim; the insurer failed to pay within a reasonable time; they suffered loss caused by the insurer’s breach of the implied term; and that the loss was foreseeable.
That said, a commercial claim may be more complex and warrant more in-depth investigating and, in theory, time frames may be more pressing.
It goes beyond understanding how the loss occurred and what impact it has on the customer – it enables us to manage their predicament and, in doing so, settle the claim quickly, in a cost effective way and in a way that helps the business.
Understand
For example, a local small business suffers from fire damage and all the stock has been damaged. Once it’s safe to do so, the owner will need to re-order the stock to be able to start trading as soon as possible but may not have the finances to do this.An insurer should be able to understand their individual predicament and impact of the loss, and provide the funds to the customer to go ahead and re-stock to be able to get the business back up and running as quickly as possible
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We welcome the changes as an opportunity to re-examine our processes from a new perspective. We also know that some brokers are worried about the emergence of ‘claims farmers’ as a result of The Enterprise Act.
These are companies that offer to pursue claims for compensation if a claim is thought to be paid late. That’s why we encourage any policyholders who have such concerns to speak to our commercial crew to avoid incurring hidden fees charged by such organisations.
Our crew behind brokers will continue to support them in any way required to understand the implications of The Enterprise Act post implementation which took place on 4 May.
Change may sometimes create uncertainty, but in this instance, we believe it’s positive and insurers should be there to support their brokers.
Rob Hopkins, head of household, travel and commercial claims operations at Ageas
Article is care of www.insuranceage.co.uk and can be found here
