The Leading News & Information Service For The Facilities, Workplace & Built Environment Community

Tuesday, 17 September

Unpaid Claims - Insurers Always Win

New research has revealed that companies who take their insurers to court or public arbitration over non-payment of a claim only win in around one in three cases.

The findings are from Mactavish, an adviser on commercial insurance governance and disputes, which reviewed every UK court case or arbitration appeal relating to payments under primary business insurance policies (excluding consumer and reinsurance cases) between 2013 and 2019.  Over this period, just 32% of decisions went in the policyholder’s favour.

Mactavish’s research found the sector most involved in public disputes with their insurers was construction, followed by manufacturing and transportation. For construction specific cases, only 25% of decisions were won by policyholders.

 

Unfavourable terms

The majority of disputes that organisations have with their insurers are settled through private arbitration, primarily because of unfavourable (and generally unchallenged) policy terms that limit the policyholder’s options in the event of their insurer disputing a claim.

Mactavish estimates that on average it takes around three years for disputes to be resolved and where settlements are made, they tend to be for around 60% of the original amount claimed. 

 

Cover

The main causes of insurance disputes are whether the loss is covered by the policy at all, followed by how the value of the loss should be calculated.  Secondary causes of dispute are breaches of policy conditions and inadequate risk disclosure.  There is also a growing trend for insurers to dispute claims because there has been late or incomplete notification from the client.

Bruce Hepburn, CEO of Mactavish said: “Our findings are disturbing for organisations that are looking to challenge their insurer’s decision not to pay-out on a claim when they perceive the decision to be unfair.  However, hiring professional consultants to help in this area can greatly enhance your chances of success – both to prevent disputes arising when handling a claim and to resolve them if they do.”

 

Resolution management

Mactavish offers a range of insurance governance services to organisations including analysis and the development of a resolution strategy for a potential or actual dispute with insurers. This is as an alternative to formal litigation or arbitration. Combining Mactavish’s policy wording, insurance law and commercial negotiation skills with targeted legal analysis by expert insurance barristers to assess the validity of the points in dispute, the service aims to negotiate and agree claims settlement rapidly.

Picture: Mactavish estimates that on average it takes around three years for disputes to be resolved and where settlements are made, they tend to be for around 60% of the original amount claimed. ​

 

Article written by Brian Shillibeer

Share



Related Articles

Megatrends - Globalisation And Building Services

In the last of its series of four 'Megatrends' White Papers, BSRIA has explored how globalisation is affecting almost every aspect of life and business - and...

 Read Full Article
Signing-in Book - Sneaky Peekers Check Who's Already There

If a traditional signing-in book is in use, 62 per cent of those visiting or working in an office check out who’s checked in before them. So says new research by...

 Read Full Article
Rethinking Outsourcing - Local Government In Throes Of U-turn?

There is a declining appetite for outsourcing in local government according to research from the New Local Government Network which is calling for a rethink in...

 Read Full Article
Theft Of Tools From Vans Continues To Rise

The cost of insurance claims for theft of tools from vans has increased by more than half - 55% - in the past year according to analysis by ECIC, the specialist...

 Read Full Article
Most Brits Think They Are Too Old For An Apprenticeship

Two thirds of the UK workforce wrongly believe they are too old to become an apprentice and that the age barrier is between 16-24 when in fact, there is no age...

 Read Full Article
Don't Make A Crisis Out Of A Drama

Two companies have combined to help support policy holders when things go wrong at a property and make dealing with the aftermath as hassle-free as possible. VPS...

 Read Full Article
Green In The Workplace - Not My Job

One in three UK workers say it’s not their responsibility to be environmentally friendly in the workplace as new research reveals there is a gulf between attitudes...

 Read Full Article
Facial Recognition Now Available - But Trouble Brewing Ahead

A commercially available facial recognition system has just been launched. Meanwhile, developer Argent could be in hot water for using LFR and both the ICO and a...

 Read Full Article
Wrong Formula - Chemical Firms May Not Mix

The merger of two cleaning chemical firms has raised competition concerns. The CMA has provisionally found that Ecolab’s merger with Holchem may mean...

 Read Full Article
City Coke-ies Go To Chokey & Distraction Thieves Nabbed As Well

Distraction thieves operating in the City of London have been jailed and offences halved while an organised crime gang responsible for supplying cocaine to City workers...

 Read Full Article