Reform of S53 Marine Insurance Act
HFW hosted a seminar on the Law Commission's Proposals on Insurance Contract Reform, focussing on section 53 of the Marine Insurance Act 1906, which can make the insurance or reinsurance broker directly responsible to the insurer for the premiums due under a marine insurance or reinsurance policy.
27 June 2013
Effectively, the section imposes the risk of a policyholder’s insolvency on the broker, and the risk of a broker’s insolvency on the insurer.
Since 2006, the Law Commission has considered Insurance Contract Reform and the Commission's proposals on Consumer Insurance recently came into force in England and Wales on 6th April 2013. The Law Commission is now turning its attention to finalising its proposals and recommendations on Commercial Insurance reform.
The seminar focussed on the complexities and anomalies created by section 53, the cases under which have led to considerable uncertainty in the insurance and reinsurance market. Section 53 is therefore an issue of great significance to all parties in the marine insurance and reinsurance transaction chain, and the Law Commission has to decide whether to reform or to maintain the existing provisions following consultations with the Insurance Market.
HFW Partner, Richard Spiller led the working party at the Insurance Committee of the City of London Law Society, on the s53 consultation and was therefore, well placed to chair the seminar. HFW Partners, Jonathan Bruce and Costas Frangeskides also spoke at the seminar. Costas provided a summary of the present unsatisfactory state of the law under section 53, while Jonathan presented the case for reform.
We were also delighted to be joined by the Law Commissioner responsible for Insurance Contract Reform, David Hertzell, who provided a summary of the Law Commissions' consultation on reform of section 53 and the position regarding implementing legislation.
For more information please contact Richard Spiller, Jonathan Bruce or Costas Frangeskides.