Prompter pay-out on insurance claims needed

Insurance companies should pay out more promptly on insurance claims, and should compensate claimants when this doesn’t happen. A change in legislation has been called for to overcome unreasonable delays in paying a valid claim.

The Law Commission of England and Wales has published its findings after a consultation with the Scottish Law Commission. It has said that legislation should be introduced which makes it an insurer’s primary obligation to pay valid claims after a reasonable time.

At the moment, policyholders in England and Wales cannot claim for any loss they might suffer due to the delay in receiving the money. Individuals and very small businesses can take their case to the financial ombudsman, but larger businesses cannot.

The Law Commission believes that insurance contract law should follow the principles of normal contract law, which does enable claims for damages through delays in payment.

Morgan Clark’s team of loss assessors has worked with many policyholders – both individuals and businesses – who need help because of problems in receiving pay outs on valid insurance claims. Using a loss assessor can considerably speed up resolution of claims. To find out more, read about our insurance claims management service.