The insurance industry is a giant, but even giants can be brought down.
We insure to cover loss and damage. This system works because more people insure than claim.
Insurance companies make more from our policies than they spend in claims. Simple, well no.
As we stumble through the credit crunch, increasing unemployment and the pressures of improving lifestyles, it has become obvious that a compensation culture once considered crass in the UK has suddenly achieved in the acceptability stake.
As long as the numbers add up, risks managed and there are enough clients purchasing policies then things were fine. Slowly though, a number of issues have contributed to a major threat to the insurance companies.
Tens of millions of pounds was claimed in the UK at the time of the severe floods in 2007.
The issues with global warming and coastal erosion have created a financial headache for the insurance industry.
Thousands of people lost their homes in freak flooding storms. Many still trying to put their lives together. There was little that the insurers could do at that time, other than pay-out on terms of the policy. A major headache was born.
In 2008 an actress called Leslie Ash was awarded £5m after contracting a form of MRSA after cosmetic surgery.
This alerted the UK public to the menace of Hospital Acquired Infections, namely MRSA and C Diff, Despite thousands of potential claims being put forward the insurance industry is fighting hard to keep the top tightly closed on claims for negligence. This is situation however may well turn sour for the insurers shortly as lawyers acting for the injured progress through the legal system.
The ticking time-bomb that is Asbestos Exposure may well prove to be the nemesis of the insurance industry. Damage to the human body by negligent asbestos exposure may well be thought of as the most deplorable form of negligence, but is the wriggling and writhing of the insurance companies trying to cast-off their financial responsibilities to the insured just as bad, or indeed worse.
Pleural Plaques is though of as a mild medical condition, a resultant from asbestos exposure and offers little in the way of pain and suffering to those diagnosed with the condition. This is the stance the the House of Lords made when making change to the law and taking away the claim of sufferers to damages in 2006. There was a great deal of lobbying by the insurance companies who said the damages for Pleural Plaques would cost the industry £300m plus and threaten the industry as a whole. Despite this sufferers of the condition focused on the fact that their pain was the worry that the condition would turn into more serious Asbestos related diseases such as Asbestosis, Lung Cancer or the worse type, Mesothelioma.
Incidences of asbestos related illnesses are on a steady increase, this despite earlier predictions that they would be in decline. The latency period for diseases can be upwards of 50 years. The silent killer is indeed among us. Yet the insurance industry is doing it’s damnedest to avoid paying damages.
The Scottish Parliament at Holrood recently passed bill for the redress of Pleural Plaques Compensation, which should help those suffering the condition make claim for damages on 17th June. The Insurers are taking a judicial review through the courts with an announcement expected June 12th.
It would be not only be against the will of the people but a disgrace of society if the giants of the insurance world triumph at the expense of those that they were paid to protect.