Today's report on Employers' Liability insurance "Review of Employers’ Liability Compulsory Insurance” from the DWP (Department for Work and Pensions) endorses recent initiatives by the insurance industry to improve the employers’ liability (EL) market. The report backs ABI calls for a national action plan to improve rehabilitation.

This report acknowledges that the recent step-change in premiums has been driven by the need to reduce underwriting losses, and the rising cost of claims.

John Parker, Head of General Insurance at the ABI, agrees that there is also a full agenda for the Government and other stakeholders to tackle.  He said:

"The insurance industry has responded well and quickly over the last year to the concerns that were put to us by ministers and our customers. The ABI initiative assessing trade association health and safety schemes, and the agreement on minimum renewal notice periods, demonstrate our commitment to helping businesses. We are delighted that the Government has responded to our call for a national action plan to improve rehabilitation.

“However, while the market is working, it remains fragile. We continue to believe that separation of the funding of claims for long-term occupational disease is the best way to make the employers’ liability market sustainable and attract new capital.”

- ENDS -

Notes

1.            ABI–led initiatives to improve the employers’ liability insurance market:

        Code of Practice on Renewal Notications

Under this joint ABI/BIBA (British Insurance Brokers Association) statement, EL policyholders will receive at least 21 days notice of their renewal terms.          

        Making the Market Work

Launched in September this year, this aims to ensure that EL premiums reflect good health and safety practices. Trade associations, and other similar bodies can submit their health and safety schemes to an ABI Joint Standing Committee for assessment against insurers best practice criteria. Details of the assessment are sent to all relevant ABI members to enable it to be taken it into account when assessing risks from businesses belonging to that trade body.

So far applications have been received from the Federation of Small Businesses, the National Federation of Roofing Contractors, the British Furniture Manufacturers, the Screen Printers Association, and the Mastic Asphalt Council.  Between them these bodies represent around 200,000 individual firms. The British Printing Industry Federation and the British Coatings Federation have already completed the process.

2.            In 2003 EL insurers made an underwriting loss (premiums less claims and expenses) of £306 million. For every £1 premium received, EL insurers costs were £1.32.  

3.            Enquiries to:

Malcolm Tarling          020 7216 7410 (Mobile: 07776 147667)

         Alan Leaman    020 7216 7440 (Mobile: 07957 482330)

         Emma Quantrill    020 7216 7392 (Mobile: 07712 841183)

         Lucy Butler        020 7216 7411 (Mobile: 07712 841184)