The UK government has set out plans in this week’s Queen’s Speech for a new International Sanctions Bill (the “Bill“) that aims to ensure that the UK will continue to meet its international sanctions policy obligations and national security objectives after its withdrawal from the European Union.
The UK currently implements 34 sanctions regimes, each of which aims to influence a change in unacceptable behaviour, constrain certain activities (such as nuclear weapons programmes) or communicate disapproval. Many of these exist within EU legislation and will therefore need to be transferred into UK law or replaced before Brexit.
The government has today set out the details of its legislative programme for the next two years in the Queen’s Speech. One of the issues to be addressed in this parliamentary session will be tackling the “compensation culture” surrounding whiplash claims, in addition to much stricter regulation of the activities of claims management companies (“CMCs“).
The two bills announced in the Queen’s Speech of particular relevance are the Civil Liability Bill and the Financial Guidance & Claims Bill, both proposed as part of a series of new measures to protect consumers.
Civil Liability Bill
There has been an increase in the number of insurance claims for soft tissue injuries sustained in road traffic collisions of around 50% since 2006. This is because it is comparatively easy to obtain substantial compensation for these injuries, which has led to the promotion of a “compensation culture” by claims management companies (“CMCs“), as well as an increased number of exaggerated claims.
Hogan Lovells Litigation and Arbitration partner, Pieter Van Tol, has written a recent article, entitled “Service of Suit Clauses: Do They Also Dictate the Applicable Law in Reinsurance Disputes?” The article was published in the last ARIAS Quarterly. This should be of particular interest to practitioners and companies with connections to New York because, as noted in the article, the New York courts have construed Service of Suit Clauses as mandating the choice of substantive law. Please click here to access the full article.
If you are interested in discussing in greater detail, please contact Pieter.
The classification of index and unit linked policies as insurance or financial products continues to be debated in Italy, notwithstanding the Supreme Court’s decision no. 6061 of 18 April 2012.
The issue arises from the enactment of Law no. 262/2005 – entered into force on 25 January 2007 -, which extended the application of the Italian Financial Act over “financial products issued by insurance companies“, formerly governed by the Insurance Code. Based on the principle of tempus regit actum, most of the Italian Courts ruled that linked policies issued before 2007 could only be governed by the Insurance Code (see decisions by the Courts of Treviso 13 July 2005, Lecce 15 January 2007, Rome 20 march 2009, Naples 5 June 2009). According to some others, Law no. 262/2005 shed light on the financial nature of such products, subject as such to the Italian Financial Act independently on the time when they have been issued (see decisions by Courts of Venice 24 June 2010, Milan 23 July 2010, Parma 10 August 2010).
The Supreme Court [see our post of 9 April 2014] unfortunately failed to take a clear position in this debate and preferred a case by case approach, asking Italian Judges to apply a sort of risk factor test, whereby the disputed policy will be classified as insurance product only if the demographic risk taken by insurance companies prevails over the financial risk assumed by consumers. Continue Reading
On 5 June 2017, in response to the Congressional efforts to “repeal and replace” the Affordable Care Act (the ACA), the New York Department of Financial Services (NYDFS) issued a press release entitled “Governor Cuomo Announces Aggressive Actions to Protect Access to Quality, Affordable Health Care for All New Yorkers” (the Press Release), which outlines the “aggressive actions” Governor Andrew M. Cuomo intends to take to “make certain that no matter what happens in Congress, the people of New York will not have to worry about losing access to the quality medical care they need and deserve.”
The Press Release outlines the types of actions that will affect how health insurers operate in New York even if Congress passes a bill to repeal significant requirements of the ACA. It also provides that the “new first-in-the-nation measures will ensure that essential health services are protected and covered for all New Yorkers regardless of efforts at the federal level to strip millions of Americans of their healthcare.”
To continue reading, click here.
The Hogan Lovells’ Corporate Insurance Newsletter for May has been published. This provides a round-up of UK, EU and international regulatory developments relevant to UK based insurance market participants. In this issue, amongst other items, we cover:
- The FCA’s final rules on implementing information prompts in the annuity market
- The FCA’s consultation on proposed guidance on its approach to reviewing Part VII transfers of insurance business
- Updates on PRIIPS Regulation from the FCA, PRA and European Commission
Two years after the Insurance and Bonding Companies Law was enacted, surety insurance is finally starting to take effect in Mexico and coexist with other institutions that integrate the bonding sector.
In Mexico, surety insurance is regulated as a mechanism to guarantee obligations, under which an insurer must indemnify the insured (ie, the beneficiary) in case of a breach of the policyholder’s legal or contractual obligations.
Click here to read the complete article.
On 16 May 2017 the CIRC and the Hong Kong Office of the Commissioner of Insurance (“OCI“) entered into a framework agreement aimed at mutual recognition of solvency regimes between Mainland China and Hong Kong.
China adopted a risk-based capital regime, C-ROSS, with effect from 1 January 2016. In Hong Kong, the consultation on a risk-based capital regime is ongoing (with a first quantitative exercise expected to occur later this year), and it is likely that such a regime will be introduced in a few years’ time. Continue Reading
Background to the issuing of the Polish regulator’s position
Based on the new regulation in the Polish insurance market that entered into force on 1 January 2016, the general terms and conditions of insurance (“GTC“) as well as other standard contracts must be published by insurers on their websites. The Polish regulator (“KNF“) noticed, however, that the fulfilment of this obligation differed among insurers. Consequently, the KNF noted the need to unify the practice in these terms and recently issued its position concerning insurance companies publishing their standard contracts on their websites. The document is available here in the Polish language version only. Continue Reading
On Monday 15 May 2017 the Financial Conduct Authority (FCA) published a consultation paper on new proposed guidance on its approach to reviewing applications to transfer insurance business under Part VII of the Financial Services and Markets Act 2000 (FSMA) (a Part VII Transfer). Comments are requested by 15 August 2017.
In accordance with the terms of a Memorandum of Understanding between the FCA and Prudential Regulation Authority (PRA), the PRA takes the lead on managing the process of a Part VII Transfer and has responsibility for approving the appointment of an independent expert, approving notices, issuing the necessary certificates and corresponding with overseas regulators if necessary. The FCA has an active role in the process and must be consulted with by the PRA at all stages. Both regulators may provide reports to the Court and attend the final Court hearing. Continue Reading