Topic: Insurance

Subcontractor required to provide own insurance held not entitled to project insurance (UK)

By Patrick Bracher on April 5, 2018 Posted in Insurance

Where project-wide cover was taken out for a construction contract for extensions to a school but the roofing contractor was obliged to take out its own insurance, it was held that the roofing contractor who caused a fire and a loss of £8.75 million was not entitled to the benefit of the project-wide insurance. The facts … Continue reading

Financial Sector Regulation Act in force from 1 April 2018

By Patrick Bracher on April 3, 2018 Posted in Banking, Insurance

Most sections of the Financial Sector Regulation Act 2017 were brought into force from 1 April 2018. This step was anticipated as the first step towards the commencement of the new Insurance Act on 1 July 2018. By a two-step process the Minister was empowered in a Gazette of 29 March 2018 to make regulations, which were passed … Continue reading

Subrogation summarised (UK)

By Patrick Bracher on March 29, 2018 Posted in Insurance

A neat description of subrogation appears in a recent UK case: ‘The concept of subrogated rights is well known. If a party is insured against an insured risk, and that risk eventuates and causes loss, the insurer will make good to the insured party the loss suffered as a result of the occurrence of the … Continue reading

Short-term Insurance Act 1998: Proposed amendments to the regulations made under section 70 affecting premium collection

By Patrick Bracher on March 26, 2018 Posted in Insurance

New draft premium collection legislation The National Treasury has published draft regulations for comment by 23 April 2018 regarding the collection of premiums by intermediaries (short-term and long-term premiums). The draft regulations require detailed premium collection authorisations by insurers to intermediaries. The proposed regulations also require a separate bank account for premiums received and require payment … Continue reading

Interpreting insurance policies (UK)

By Patrick Bracher on March 26, 2018 Posted in Insurance

A recent UK decision made some interesting remarks regarding the interpretation of an insurance policy which should be no different in South Africa: The wording of the schedule and the policy wording must be considered together without giving greater weight to either. The fact that clearer words could have been used does not mean that … Continue reading

No cover for racing school accident even though exclusion not read by insured (US)

By Patrick Bracher on March 14, 2018 Posted in Insurance

Where a motor policy excluded coverage ‘for any vehicle located inside a racing facility for the purpose of … or participating in any driving school, driver training or skills training’ the court refused the insured an indemnity to cover a crash at a motor racecourse skills-training event. The insured crashed while he was instructing a … Continue reading

What is personal lines business?

By Patrick Bracher on February 28, 2018 Posted in Insurance

Despite objections at the comments stage, the Registrar of Short-term Insurance has defined a ‘policy’ for the purposes of the Policyholder Protection Rules as a short-term policy where the policyholder is a natural person or a juristic person with an asset value or annual turnover less than the R2 million threshold. That has ridiculous consequences. It … Continue reading

Duty of disclosure: is the refusal to renew residential policy material to a commercial policy?

By Craig Woolley on February 21, 2018 Posted in Insurance

Higherdelta Ltd was the owner of commercial properties including a restaurant in Scotland. Its company secretary, director and shareholder was also the owner of a portfolio of residential properties. The non-disclosure of prior events relating to the personal portfolio was held not to be relevant to underwriting the business policy. The restaurant was added to … Continue reading

Strict compliance with policy cancellation provisions is necessary

By Patrick Bracher on February 19, 2018 Posted in Insurance

Two 2017 US cases illustrate the importance of a notice cancelling a policy complying strictly with the requirements of the policy and the law. In Las Vegas Inc v Oregon Mutual Insurance Co, the notice of cancellation became effective on a stated future date if the policyholder did not pay the premium by a required … Continue reading

UK chief executive fined £1.15 million over trust funds

By Patrick Bracher on February 5, 2018 Posted in Insurance

The UK Financial Conduct Authority has fined One Call Insurance Services Ltd and its chief executive £1.15 million for failing to protect its clients’ money and to hold it in trust instead of using it to cover its own financial needs. The insurer allegedly ‘inadvertently’ used funds from its clients’ money account to finance its own … Continue reading

Insurance Act assented by State President

By Patrick Bracher and Adriaan Louw on January 24, 2018 Posted in Insurance

On 18 January 2018, the Insurance Act was published in the Government Gazette after it had been assented to by the State President. It is known as the Insurance Act 2017. The Insurance Act, which was tabled in the National Assembly in January 2016 and completed its journey through the parliamentary process in December 2017, … Continue reading

What happened to policy data administration services?

By Patrick Bracher on January 18, 2018 Posted in Insurance

A previous draft of the Short-term Insurance Regulations included policy data administrative services (PDAS) as a service attracting remuneration of 2% of premium. This was left out of the final regulations. According to the National Treasury Key Issues document ‘It has been decided, at this stage, to maintain the status quo by not classifying PDAS … Continue reading

Amended long-term insurance regulations

By Patrick Bracher and Claudia Eisenberg Jackson on January 11, 2018 Posted in Insurance

The amendments to the Long-term Insurance Regulations gazetted on 15 December 2017 became effective on 1 January 2018 with some later effective dates below. The corresponding amendments to section 49 of the Long-term Insurance Act 1998 (LTIA) also take effect on 1 January 2018. The changes to the Long-term Insurance Act Regulations include changes to the remuneration and practices … Continue reading

Amended short-term insurance regulations

By Patrick Bracher and Claudia Eisenberg Jackson on January 11, 2018 Posted in Insurance

The amendments to the Short-term Insurance Regulations gazetted on 15 December 2017 became effective on 1 January 2018 with some later effective dates below. Corresponding amendments required to the Short-term Insurance Act 1998 (STIA) also take effect on 1 January 2018. The majority of the changes to the Short-term Insurance Act Regulations relate to the circumstances in which … Continue reading

The massive cost of medical negligence cases is an international problem

By Sandra Sithole on December 11, 2017 Posted in Insurance

It is not only in South Africa that the cost of medical negligence lawsuits is draining the health service. There are calls in Britain for reform to help protect the National Health Service from pay-outs which hit GBP1.4 billion in the fiscal year ending March 2016 alone. The UK Centre for Policy Studies says that the … Continue reading

UK Automated and Electric Vehicles Bill

By Patrick Bracher on December 11, 2017 Posted in Insurance

The UK has published the Automated and Electric Vehicles Bill. If an accident is caused by an automated vehicle when driving itself whilst insured at the time it causes anyone to suffer damages, then the insurer is liable for that damage caused to anyone. If the vehicle is not insured the owner of the vehicle … Continue reading

IAIS calls for simple insurance products

By Patrick Bracher on December 6, 2017 Posted in Insurance

It has been reported (Law360) that the International Association of Insurance Supervisors has urged governments to make sure that insurers selling basic cover to the world’s poorest communities keep their products simple to prevent misselling and to avoid excessive costs. According to the IAIS ‘inclusive insurance products and their distribution need to be easily understood … Continue reading

Insurance industry ‘excited’ about InsurTech

By Caroline Theodosiou on November 22, 2017 Posted in Insurance

Most insurance companies acknowledge that major change is coming and the insurance world is excited about the changes that InsurTech may bring. Recently we have seen reports in the media that local insurance companies are spending significant amounts of money in partnering with various InsurTech companies in an effort to embrace the changes. InsurTech is effectively … Continue reading

Rising tide for directors

By Lee Astfalck on November 9, 2017 Posted in Insurance

State capture, growing public discontent fuelled by social media at the activities of private companies and the need for ethical business practices all present significant implications for directors and for insurers who provide directors and officers liability insurance. Increased scrutiny by regulators and industry watchdogs into the affairs of companies and the conduct of their … Continue reading

Policy requirement to comply with statutory or regulatory standards requires reasonable care not absolute compliance

By Patrick Bracher on October 29, 2017 Posted in Insurance

An Australian court has interpreted the obligation in a business liability policy to ‘comply with legislation and Australian Standards’ coupled with a general condition requiring the insured to ‘take reasonable care to avoid causing harm’ as requiring reasonableness and not absolute compliance. Not every minor breach of regulations can be regarded as an infringement of … Continue reading

Sitting is not an ‘accident’ (US)

By Patrick Bracher on October 11, 2017 Posted in Insurance

In a curious case the Michigan US Appeals Court found that merely sitting for a long period of time which allegedly led to a truck driver dying of a pulmonary embolism while sitting in the cab of his truck at a truck stop was not bodily injury caused by an occupational accident. Medical evidence said … Continue reading

Unintended overdose of prescribed drug is an ‘accident’ (Singapore)

By Patrick Bracher on October 3, 2017 Posted in Insurance

An injury caused by or sustained in an ‘accident’ under an insurance policy connotes an accident sustained in circumstances where the assured neither intended nor expected to suffer the injury. The test is a subjective one. Once it is established on a prima facie basis that the insured did not intend or expect to suffer … Continue reading

Two year insurance time-bar upheld (US)

By Patrick Bracher on September 26, 2017 Posted in Insurance

A Delaware court upheld a two year time-bar in relation to a property damage insurance claim arising from Superstorm Sandy because the action was instituted more than two years after the 2012 event and after coverage was denied by the insurer in 2013. The limitations clause provided that ‘no suit, action or proceeding for the … Continue reading