Special Jurisdictions Virtual Insurance Conference reaches over 1000 clients
Our first Special Jurisdictions Insurance Conference tackled some of the big issues relating to claims in Scotland, Northern Ireland and the Republic of Ireland. It was a great success with over 1000 clients signed up to the 16 sessions over 2 days. Our strong presence in all three jurisdictions allowed us to share local knowledge and expertise on the nature of claims work/business post crisis, large loss, fatal claims, pre-litigation strategies, costs, credit hire, QOCS, and professional indemnity.
"I was delighted to have been involved in two of the virtual insurance conference sessions. It is important, more now than ever, that we continue to engage with clients, share information about claims behaviour and disrupt new emerging fraud tactics."
Jill Sinclair, Partner, Counter-fraud
"This was the first time the team presented virtually to a live audience and we found it a great way to connect with clients remotely during lockdown. Any concerns about the logistics proved unfounded and now we have experienced the process we will be looking to this as the "new normal" way of presenting going forward."
Alison Grant, Partner, Professional Indemnity
If anyone wishes access to the recordings from the conference please contact Caroline Coyle
The Scottish Government is now in recess until 9 August. Below are the areas we consider will be important for insurers in the second half of the year.
Group Proceedings – This week the Court of Session approved new rules relating to group proceedings (class actions) which will come into force on 31 July 2020. These type of actions represent a significant risk for insurers as the procedure facilitates the grouping of individual claims which often results in both higher value claims being raised and indeed claims intimated that would otherwise not have been made.
The after effects of the COVID-19 pandemic may mean there is more interest in mass litigation following exposure/cancellation claims.
The most important consideration for any collective proceedings mechanism is whether it is implemented on an opt-in or an opt-out basis. The former requires the positive consent from potential class members to participate in the claim, the latter automatically aggregates all class members unless and until they choose to leave the class (opt-out).
The new rules introduce opt-in procedure but it is thought the Scottish Civil Justice Committee will continue to consider the option of opt-out procedure.
QOCS – the primary focus remains when will QOCS be brought in? We have heard in the last few weeks that it is likely to be winter 2020 now before QOCS will finally be introduced. This will be a major change for the insurance claims sector in Scotland. The definition and interpretation of "fraudulent misrepresentation" sufficient to lose QOCS protection will be important in determining whether claimants will be deterred from raising unmeritorious claims.
Principally intended to clarify the period from which time starts to run where a person seeking damages is not fully aware of the circumstances of their loss or who caused it. However, it also amends the law around the 20-year period when an obligation is finally extinguished, the law on relevant claims, including in situations of insolvency, the ability to contract out of the Act and on the burden of proof.
Despite receiving Royal Assent on 18 December 2018, the Scottish Government continues to work on commencement and transitional provisions. It may be later this year or indeed now 2021 before the new prescription regime comes into force.
The Historical Child Abuse Redress Bill - What does this mean for insurers?
Financial contributions for redress are being sought from those who bear responsibility for historical abuse. Redress payments to survivors may be dependent on the survivor agreeing not to raise civil action in respect of abuse. That agreement may come in the form of a waiver, and consideration is ongoing about extending the protection of that waiver to those who make fair and meaningful financial contributions to the redress scheme.
Participation in the scheme may therefore offer an opportunity to crystallise future liability for historical abuse.
Pre-legislative consultation has now closed. COVID-19 may well now delay the passage of the Bill through the Scottish Parliament.
Abuse claim – lump sum loss of earnings preferable. ASPIC - Sheriff McGowan discussed the problems in calculating the loss of potential earnings using a multiplier or multiplicand. This type of approach often results in an over optimistic figure being put forward by a pursuer. Sheriff McGowan considered a lump sum was a better approach in this case. This case is useful for insurers to refer to in negotiations especially where there is a large loss of earnings claim.
Fatal Claim - Although in the recent case of Jennifer McCulloch and Others v Forth Valley Health Board  CSOH 40 the pursuer's case on primary liability failed, most of the heads of claim had previously been agreed as set out in this table:
Interestingly, Lord Tyre would have allowed £80,000 plus interest for the son and daughter (aged 7 and 1 at date of death), in keeping with the jury award of £80,000 in Anderson v Brig Brae Garage Ltd 25 June 2015. The total value of the claims was over £1 million.
Useful rough guide for assessment of judicial awards – by pursuer
Spouse of deceased – £75,000 to £120,000
Adult child of deceased – £30,000 to £60,000
Child of deceased – £60,000 to £120,000
Parents of deceased – £60,000 to £100,000
Sibling – £15,000 to £30,000
Grandparents – £15,000 to £30,000
Grandchildren – £12,000 to £28,000
Scottish Child Abuse Inquiry
While public hearings were paused as a result of the pandemic, Lady Smith was keen to emphasise investigative work continued in the background. Further updates can be read in the Spring /Summer Newsletter 2020 here
What are we doing?
28 July - Disrupt to Progress
Virtual Client Training Sessions – dates being organised directly
For further information please contact:
Andrew Lothian, Head of General Insurance (Scotland) on 0131 474 2305
Alison Grant, Partner, Professional Indemnity (Scotland) on 0141 228 8127
Jill Sinclair, Head of Counter Fraud (Scotland) on 0141 228 8196
Caroline Coyle, Senior Associate and Professional Support Lawyer, Insurance on 0141 228 8132