Claim Brokers
Date: May 02, 2006
Authors: Frank Egan B.A., LL.B., A.C.L.A., F.T.I.A. (Notary)
Many corporate, commercial and business insureds shrug off the idea that they won’t get a fair deal from their insurer because of their buying power and they have an Insurance & Risk Manager, a Company Secretary/Finance Director and/or an Insurance Broker who are there to ensure this can’t and won’t happen. Think again. Yes, in some very limited cases this is true but we are now post-HIH/FAI and insurers will no longer make settlements which will compromise their bottom line. ASIC will not allow it! Everyone at this level of the market is either a provider or a buyer of insurance eg. the insurer/broker or the client/customer. Essentially everyone is an expert in either providing or purchasing insurance but who is the expert when it comes to assessing and adjusting claims? The funny thing is that the corporate/business market looks to their broker as “Claims Brokers”. So what you have is an organisation which has procured the account, services the client purchasing decisions and now represents them as claims brokers when dealing with claims. There is a massive conflict of interest for the broker and a real concern for the client as to whether they can rely upon their broker to make full and frank disclosure where professional negligence is involved, which will affect the claims outcome. Common sense suggests that the client’s interests may well be overlooked in these circumstances due to human frailty.
To put matters in perspective the majority of brokers are not claims experts even though many hold themselves out as such. Unfortunately the broker is the agent of the insured and not the insurer and therefore the problem has to be addressed at the broker/client level as the insurer is in the clear. Even where the broker has professional indemnity insurance it does not necessarily mean that it will respond in the given circumstances in every particular case. Even where it does the question will become, what is the limit of indemnity and how much of the loss does the broking organisation have to book to their house account? That is, the higher their deductible the greater their exposure and should the known circumstance become known circumstances then depending upon the structure of the deductible it may be applied once or on a number of different occasions. If the latter then the whole claim may have to be booked to their house account and the insurer apart from notification may have little involvement. It is often said that this cannot occur but it does. This may have potential serious financial consequence for the broker not only because their PI policy may not respond but they may lose an important account.
This problem is further exacerbated as broking organisations come under additional pressure because at the top end of the market they are talking about premiums measured in the hundreds of thousands/millions/tens of millions of dollars. The loss of these types of accounts may be a real threat to the financial viability of a brokerage house dependent on its size and may cause some unusual decisions to be made about the responsibility for the placement of a cover and or how any one claim falling for consideration under the relevant insurance program is to be deal with. The reality is, that all insurance claims should be referred to insurers who can make an unfettered decision as to their acceptance or rejection. Should the client believe that they have been unfairly treated then they can appoint their own independent expert to achieve the desired outcome. Of course issues associated with the nature and extent of a cover can be independently addressed together with the quantification of the loss. Under some policies claims preparation costs may be included which would be of benefit to the insured. Once again whether you be an insurer or an insured when you become involved in a problem claim seek independent legal advice from LAC Lawyers which possesses the necessary expertise to address your concerns.
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Phone LAC Lawyers on NSW 1300 799 888 or VIC 1300 734 638 or send us an email
Am I Being Sued?
Date: March 26, 2010
Author(s): Pheba Netto LL.B. (Hons)
This is the question that one would often ask yourself when you receive a letter from a legal firm. Many people often receive mail, emails, faxes, notifications etc in their mail or by personal service, courier and several other methods notifying them that legal action has commenced or that it is being contemplated. To the ordinary man on the street, this alone can cause a lot of stress and worry and be the root of unnecessary panic and anxiety.
Australian General Insurance Claims Practice
Date: August 02, 2006
Author(s): LAC Lawyers
Does The Duty of Utmost Good Faith Apply to Claims
Date: May 04, 2006
Author(s): Frank Egan B.A., LL.B., A.C.L.A., F.T.I.A. (Notary)
Originally the duty of utmost good faith was a common law concept which applied directly to contracts of insurance.
Home Warranty Insurance
Date: December 31, 2008
Author(s): Frank Egan B.A., LL.B., A.C.L.A., F.T.I.A. (Notary)
There is an approved list of insurers who sell home warranty insurance for residential building work in NSW under the Home Building Act 1989. Essentially home warranty insurance is required for residential building work including the supply of a kit home where the value of the work exceeds $12,000. Previously minimum cover was stipulated at $200,000 but from 1st March 2007 this was increased to $300,000.
In Brief - The Steps Involved in Commencing and Running a Civil Action
Date: March 15, 2010
Author(s): Pheba Netto LL.B. (Hons)
A brief rundown of the steps involved in running a cicil action. For more information fill free to call LAC Lawyers on 1300 799 888. LAC Lawyers = RESULTS
Insurance Contracts Act - Changes to Insurance Law and Practice for Insureds, Insurers and Brokers
Date: August 02, 2010
Author(s): Michael Pickering B.A., LL.B. (Hons.), LL.M., M. A.
Important amendments to the Insurance Contracts Act 1984 (Commonwealth) (“the ICA”) were expected to be passed by the Commonwealth Government in the Spring session of the 2010 Parliament. Their passage will now have to await the sitting of the new Parliament in late 2010.
Insurance Law - Product Liability
Date: May 10, 2010
Author(s): Pheba Netto LL.B. (Hons)
Generally product liability in law refers to the responsibility or the liability of manufacturers, distributors, suppliers, retailers, and others who produce and supply goods/products to the public which result in damages or injury caused by the use of a defective product.
Insurance Law - Storm Claims and the Newcastle/Hunter Region
Date: June 21, 2007
Author(s): Frank Egan B.A., LL.B., A.C.L.A., F.T.I.A. (Notary)
Although underinsurance or the lack of insurance is a major problem for the community in both good and bad times its importance is critical in times of natural disasters including storms and cyclones. Every time there is a major storm either general or localised flooding is a problem.
Insurance Law - The different types of Insurance Claims and why they are sometimes denied
Date: October 09, 2006
Author(s): Frank Egan B.A., LL.B., A.C.L.A., F.T.I.A. (Notary)
Claims are often denied by insurers for a variety of reasons. They may have been denied for anything from non-disclosure of material fact through to fraud or over-capitalisation of loss. Interestingly, there has been a fundamental change over the last ten years in the approach taken by insurers with the denial of claims.
Insurance Law and Business Interruption Insurance
Date: December 05, 2007
Author(s): Frank Egan B.A., LL.B., A.C.L.A., F.T.I.A. (Notary)
People in business insure their premises, contents and stock against the material damage risks of fire, explosion and other perils, but have they given the same thought to the other problems which would arise following any of these events, the problems which manifest themselves when the fire engines have driven away.
The Benefits of Hiring A Lawyer
Date: August 16, 2006
Author(s): LAC Lawyers
The old adage “you get what you pay for” is as true today as it has ever been.
What Impact Has Civil Liability Act 2002 (NSW) Had On Damages and Personal Responsibility?
Date: February 12, 2006
Author(s): LAC Lawyers
Essentially the change has been profound as people are now required to look after themselves and take responsibility for their actions. The Civil Liability Act mainly deals with the question of damages whereas the amending Act deals with liability, but, with that said, the courts now pay proper respect for the concept of personal responsibility as required under the Civil Liability Act 2002 (NSW) ("the Act") and the Civil Liability Amendment (Personal Responsibility) Act 2003 ("the Amending Act").
What Insurance Crisis - Is There Really One Following The Collapse Of HIH and FAI?
Date: February 12, 2006
Author(s): LAC Lawyers
Many commentators have gone out of their way to suggest there was an insurance crisis and that it arose out of increased litigation, more successful claims and higher awarded damages which led to the unaffordability of public, products and professional indemnity insurance.
What to expect when you call LAC Lawyers
Date: December 13, 2006
Author(s): LAC Lawyers
LAC Lawyers is a full service firm dedicated to the provision of superior legal services in Australia. Our aim is to provide unrivalled client satisfaction coupled with high quality service and advice. When you call LAC Lawyers our friendly reception staff will spend time with you to identify the area of law your enquiry relates to then pass you on to one of our qualified solicitor's who can help you.
Why Insurance Claims Are Not Paid
Date: May 02, 2006
Author(s): Frank Egan B.A., LL.B., A.C.L.A., F.T.I.A. (Notary)
Why stay with your lawyer
Date: August 01, 2006
Author(s): LAC Lawyers
The lawyer/client relationship is a personal one and there are many reasons which will dictate who you can and cannot work with. If you don’t like your lawyer, should you change? Ultimately, the relationship between a lawyer and client must be built on mutual trust.