Press Release
ABI calls for reforms to free businesses from UK compensation culture
14 March 2012
The Association of British Insurers (ABI) today called for action to free businesses from the fear of the UK's compensation culture and overzealous interpretations of health and safety rules that could hold back Britain's economic recovery.
Speaking at a Chartered Institute of Environmental Health conference today (14 March), Nick Starling, the ABI's Director of General Insurance, said:
“Businesses, especially the small businesses crucial to our economic recovery, need to be able to thrive, not operate worried by the constant risk of being sued for the most minor of injuries and confused by health and safety requirements. Insurance is here to help businesses do what they do best, free from the fear of being sued or engulfed in red tape. This is why following the industry's recent insurance summit with the Prime Minister, the ABI has agreed to work with other stakeholders and develop a short simple leaflet to be included in policy documents, dispelling myths around what is and isn't required from insurers.”
ABI data reveals that for every £1 paid out to settle 'slip and trip' style liability claims, nearly the same amount – an additional 93p – is paid out in legal fees. This together with a legal system that encourages people to make exaggerated and fraudulent claims – fuelled by 'no-win-no fee' claims management companies - means UK businesses are left shouldering high and disproportionate legal costs, which they are paying for through their employers' and public liability insurance premiums. One large supermarket chain said it needed to keep five stores open a year to pay for personal injury costs alone.
With such high costs at stake, action is needed to prevent UK businesses feeling bogged down with overzealous interpretations of rules and health and safety myths. From annual electric testing of kettles, onerous risk assessments, misinformation about the need for dedicated health and safety consultants and even a ban on the use of bunting at events, there is a risk that prevailing health and safety myths can slow UK businesses down and foster risk aversion. The ABI supports the Government's intention to introduce a portal for dealing with workplace injuries and public liability claims to speed up the payment of genuine claims and make the system more efficient and cost effective.
Nick Starling added:
“The UK's compensation culture and high fixed legal fees means businesses are all too often left paying the high and disproportionate cost of settling compensation claims. The ABI has long argued for reforms to make our legal system more efficient, tackle spurious claims and relieve the burden on UK business. To help all firms, the Government must implement its reforms without delay.”
Press releases, papers and documents published on this page are the intellectual property of an organisation unrelated to Central Lobby. We promote their parliamentary and political campaigning activities as they are subscribers to the Central Lobby service.
As such, Central Lobby does not edit, endorse, or attempt to balance the opinions expressed on this page. The content of press releases and other such types of content are the responsibility of the originating organisation.