Tracing The Insurance Policies of Negligent Employers

For a number of years, many claimants have found it difficult to secure the compensation to which they are entitled, due to the age of their claims. If a company has gone out of business since the time at which the negligent behaviour occurred, it can be the case that insurance details have been lost. This can cause serious problems when attempting to secure money for the claimant.

Compulsory Insurance

Since the passage of the Employers’ Liability (Compulsory Insurance Act) 1969, almost all employers have been obligated to hold a valid insurance policy to cover them in the event of a negligence claim under employers’ liability. With approximately 99% compliance from employers, this means that a claim against an existing and solvent employer will almost always be covered by insurance. The issue is the difficulty of tracing historic insurance policies, when the company in question has long since gone out of business.

Insurance Tracing

This has been recognised as a problem area for many years, and in 1999 the Employers Liability Code of Practice for Insurance (ELCOP) was introduced, in order to improve the tracing of employers’ liability insurance. Unfortunately, given its voluntary status, the code had only improved the overall success rate of tracing to 46% by 2010. In reaction, the insurers instituted another scheme, the Employers Liability Tracing Office (ELTO). This scheme attracted participation from almost all insurers, but still has serious difficulty when investigating historical claims. Given that most of the issues faced by those claimants who are attempting to trace insurance policies stem from many decades ago, the increased state of compliance with voluntary tracing codes in the modern day is of limited assistance.

Untraced Scheme For Mesothelioma

In order to deal with this issue, the government announced a scheme in July 2012 which will force insurers to pool their money into a fund designed to compensate those claimants who cannot trace the historically responsible insurers. Unfortunately, this scheme applies only to mesothelioma claims, and does not affect the status of anyone suffering from other industrial diseases. This is true even for the 50% of asbestos-related claims which do not relate to mesothelioma. In addition, the limited funds available in the scheme may mean that, depending on the number of applicable claims, full compensation may not be available to every claimant. Solicitors who represent claimants in such cases continue to argue for a stronger investment into compulsory tracing, and a real effort to improve the historical records available to those claiming for previous harm.

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