Part one: Consumer insurance law reform is long overdue, says Peter J Tyldesley
Later this year the English and Scottish Law Commissions will publish a joint final report on consumer insurance law. This is the culmination of a four-year project to review an area of law which is widely regarded as archaic, unclear and unfair. It is anticipated that the report will recommend reform of the rules on non‑disclosure, misrepresentation and breach of warranty.
The critical flaw in insurance law is that it provides insurers with remedies which in many circumstances will be disproportionate. Much of the current law was established in commercial cases in the 18th and 19th centuries. At that time there was no mass market for insurance. Types of cover commonly bought by consumers today, such as household and motor insurance, simply did not exist. Insurance was typically arranged face-to-face rather than by telephone or over the internet. It is perhaps not surprising that unjust results are produced when old commercial rules are applied to modern consumer insurance contracts.
Take, for example, the rules on non-disclosure in general insurance
