Insurance briefing is a round-up of legal and business developments published on Out-Law.com.
Latest fortnightly round-up of insurance, legal and business developments with analysis and commentary from the insurance team at Pinsent Masons.
The main topics we're focusing on this week are:
Driverless cars insurance laws receive Royal Assent
A new insurance and liability regime for driverless cars has been finalised in the UK. The Automated and Electric Vehicles Act 2018 received Royal Assent on 19 July, although the majority of its provisions will not take effect until implementing regulations are also introduced into law. No timetable has yet been set for the regulations to be introduced, according to the Department for Transport. Insurance expert Chamika Hand of Pinsent Masons said "the 'single insurer' model provided for in the new legislation will supplement the existing compulsory insurance regime that covers motor claims in the UK. Whilst some manufacturers are now saying they will take full liability for any accidents caused by their autonomous vehicles, at this stage, the emphasis in the legislation is that the compensation route for injury/damage caused by an automated vehicle will fall within the motor insurance settlement framework. If the risk of accidents is significantly lower for autonomous vehicles, and some calculations suggest it could be 50 times lower than for conventional cars, manufacturers would only have to make a very modest increase in the purchase price to cover the cost of the risk they are taking on."
Brexit: UK legislates for 'temporary permissions' in financial services
Proposed new legislation aimed at providing a smooth Brexit transition for EU-based financial services firms operating in the UK ha been set out by the UK government. The 'temporary permissions regime' provided for in the proposals is envisaged to apply should the UK exit the EU without agreeing on a Brexit implementation period with negotiators for the remaining EU member states. In the event of that scenario, the rules planned would allow the EU-based firms to continue serving UK customers for a limited time from the date the UK leaves the EU – scheduled to be 29 March 2019.
Vehicle-related terrorism claims 'mutualised' by UK motor insurers
Motor insurers in the UK are to share the costs involved in meeting third party claims raised by victims of terrorist attacks involving vehicles. The rationale for the development came following concern about coverage for motor terrorism risks after the recent increase in terrorist activity involving vehicles. Under the new arrangement, industry body the Motor Insurance Bureau (MIB) will handle claims stemming from the use of vehicles to injure or kill people. It will apply to incidents that occur on or after 1 January 2019. The change was voted through by UK motor insurers. Those insurers are members of MIB, which is funded through an industry levy.
Court dismisses claim duty of care is owed to employees in litigation
Employers do not owe their employees a duty of care in the way they defend claims that they are vicariously liable for actions of those employees, the UK Supreme Court has ruled. The court said it would not be "fair, just or reasonable to impose on an employer a duty of care to defend legal proceedings so as to protect the economic or reputational interests of his employee". The Supreme Court considered complaints raised by police officers over the way the head of the Metropolitan Police Service handled a defence against claims that she was vicariously liable for their conduct. Although the relationship between a police force and police officer is not technically that of employer-employee, the court said the situation was analogous to that situation. Commercial litigation expert Michael Fletcher of Pinsent Masons, the law firm behind Out-Law.com, said that the court's ruling in the case would therefore be welcomed by businesses that find themselves defending claims brought against them based on vicarious liability for the actions of their employees.
US fintech report offers chance to compare with UK and Europe
ANALYSIS: A recent report has highlighted areas of similarity as well as differences in the way US authorities are responding to the rise of fintech in comparison to counterparts in the UK and Europe. The report was published by the US Treasury last week. It addressed the US approach to issues such as 'open banking' and APIs; the use of cloud-based solutions; and regulatory sandboxes, all of which are live topics elsewhere in the world.
Insurance briefing is a round-up of legal and business developments published on Out-Law.com.
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