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Sector Soapbox
Modern Claims’s panel of resident industry associations BIBA, MASS and FOIL consider the burning issues impacting the claims industry at the moment.
The great tumble dryer fiasco ost people should by now be familiar with the product recall of approximately 4.3m faulty tumble dryers across the UK within the Whirlpool Group including Hotpoint, Indesit and Creda, due to a fault which was originally identified in October 2015. Many customers, including myself, are still waiting for the promised modification, which I believe in my case will arrive in August 2016, but not until December and beyond for many other customers. Whirlpool has dealt with the matter poorly but they have now started to offer replacement tumble dryers at a lower specification to absolve themselves of the responsibility of coming to modify the fault. But, as alleged in a Daily Telegraph article on 15 March 2016, it seems that the replacement tumble dryers may also be faulty. As well as exercising the product recall and products liability insurance of the Group, this matter came to my attention as Chair of the Industry Claims Working Group (CWG), when an insurer took the decision to repudiate liability for a fire claim which emanated from one of the faulty tumble dryers. The customer was using the dryer to the manufacturer’s instructions so there were no grounds, either moral or technical, to repudiate liability for the claim. However, what it did demonstrate is that the evolution of the accidental damage cover on household policies has caused wordings to change and the interpretation of a defective
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product wording has become skewed away from the original intention; the principle of insurers covering “fire, however caused”. Due to the intervention of BIBA and the CWG, the insurers retracted the repudiation and the claim was correctly paid. The CWG itself also generated constructive dialogue with insurers that are members of the group, raising awareness of the issue, with all member insurers agreeing that interpretation of the wording and subsequent repudiation was wrong. It also enabled them to ensure that similar claims received by their offices would be dealt with appropriately. The one sad fact in this case was that - upon referral to the Financial Ombudsman Service by the CWG suggesting that guidance be issued to insurers – and in the light of this case, there was little interest to become involved. At the advent of the Financial Conduct Authority, it was suggested that it would be a “forward looking” regulator and one would have hoped that the Ombudsman might have taken a similar view, which may have resulted in a considerable amount of work being saved for their team in the future. Meanwhile, I continue to wait with bated breath for the visit of the Whirlpool engineer to correct the fault on my tumble dryer, hopefully before Christmas 2016! Andrew Gibbons ACII, Managing Director, Mason Owen Financial Services Ltd and Chair on behalf of BIBA of the Industry Claims Working Group.
A change of direction y way of a break from being asked to write, talk, and attend meetings about the proposed changes to whiplash, I was pleased to be asked recently to consider whether MASS could support an initiative calling on the Government to take action on the high incidence of fatal and serious accidents caused by young drivers. As it happens one of my sons is currently learning to drive, and I have been considering what I can do to get him relatively safely and affordably on the road when he passes his test.
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It is well known that young drivers are involved in more catastrophic and fatal motor accidents than any other category of road user. The risk of death is doubled for 15-19 year olds and (for males in this group) trebled from the general population. Most experienced personal injury lawyers will have seen those dreadful cases where a carload of teenagers suffer life-changing injuries due to the reckless driving of a teenager who has just passed his test. Apparently the cost to the economy of these was £2.9bn in 2013 – it’s a large number, and I’m not quite sure how it is calculated, but whatever the financial cost, it is insignificant alongside the personal cost to young people of having to live with the consequences of brain and/or spinal cord injuries.
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Road safety charity Brake’s ‘Too young to die’ campaign is calling for the introduction of graduated driving licensing (GDL). Brake suggest a 12-month learner period before sitting an initial test. A further test would then follow after a two-year novice period when restrictions apply such as a late-night driving curfew and restrictions on the size of engine they can drive. Of course, the risk of making it more difficult and expensive to become a fully qualified driver is that the number of unlicensed, uninsured young drivers would simply increase. However, the evidence from New Zealand, Australia and some US states, suggests that the introduction of GDL has reduced young driver injuries. This is certainly a topic on which a public debate is needed, and – to come back to where I started, the proposed changes to whiplash, because I can’t get away from them – probably an infinitely better place for the Government to allocate legislative time and resource. Instead of wasting time seeking to deny accident victims justice, let’s save an awful lot of human misery by driving out accidents involving young drivers. Susan Brown, Chair, the Motor Accident Solicitors Society (MASS) and Director, Prolegal.
July 2016