of a tool capable of tracking insurance litigation and claims performance to offer this insight has been long overdue in the UK market. Common Insurer Defences for Rejecting Claims In order to understand on what specific basis insurers are declining to pay out claims, Mactavish analysed the legal pleadings in 50 of the most recent legal claims. Focusing only on cases where insurers are defendants, we see that the cases centre almost exclusively on the pursuit of unpaid insurance claims by commercial policyholders. The two most common reasons given in defence of their refusal to pay out a claim were that the policyholder lacked coverage for the specific loss event and/or arguments around non-compliance with policy terms. One of the reasons why these defences are so often relied upon comes down to a widespread issue found in many insurance policies. Too often, we see policy wordings that are not provided until months after placement and are accepted by businesses despite containing issuance errors and drafting ambiguities that are subject to enormous difference in interpretation. In the current hard market, this ambiguity creates a far greater risk of non-compliance or lack of coverage – unbeknownst to the policyholder and not raised by insurers and brokers when policies are sold – which can be relied on by insurers to contest payouts. Often, thepolicy iswritten inaway that only an experienced insurance professional or specialist lawyer can accurately interpret. For instance, when it comes to notifying an insurer of a potential claim, the common time proximity requirement of ‘as soon as practicable’, ‘immediate’ or ‘forthwith’, or the requirements of providing ‘full details’ of circumstances, can mean vastly different things to a business owners and managers. It is only with years of experience in the market that these vague clauses can be decoded 42 LAWYERMONTHLY JANUARY 2023
RkJQdWJsaXNoZXIy Mjk3Mzkz