A tale of hotels, broking, culture and regulatory sops…Ant Gould reviews the news
The week after Easter is not always the busiest of news weeks, but the holiday period output still managed to raise a few eyebrows. Ant Gould reviews this week’s insurance news.
As much as it saddens me to say this, the continuing saga around Covid-19 and business interruption rumbled on this week. This time it was Tokio Marine Kiln’s hotel policies that were in the news spotlight. According to Insurance Post a group of 18 businesses, including flamboyant chef Marco Pierre White’s Black and White Hospitality arm, filed a letter of claim citing that the policies contained cover under a non-damage denial of access clause. The case will no doubt take time to weave its way through the legal system, picking up yet more negative publicity for the insurance market, whatever the eventual outcome.
So why even mention this in my news review? Well, perhaps not surprisingly, all the hotel policies were placed through the same broker, a fact that provides a neat segue into the next story to grab my attention this week. Again, this was in Insurance Post and was centred around how brokers regulatory permissions could be at risk. In short, under FCA regulations, a broker must have suitable professional indemnity (PI) cover in place for any potential claims as a result of its conduct. That’s all fine in normal times - however, since the summer many insurers have been not only hiking PI rates but throwing in Covid-19 exclusions, meaning that brokers could potentially fall foul of the rules and have their permissions withdrawn. Ouch.
Business Interruption seems to be the gift to journalism that just keeps on giving.
Continuing the conduct and regulatory theme, the team at Insurance Times ran a timely reminder for brokers that they should have, as of the end of March, embedded the FCA’s nattily titled, (not), Senior Managers and Certification Regime (SMCR) rules into their businesses.
It may not sound very sexy, but at its core is a regulatory edict that senior leaders must set the ‘tone from the top’ and, importantly ensure that all of their staff have been trained on the conduct rules and how they apply to their roles. In other words, everyone must understand that the conduct rules apply to them as well as their bosses – and that the culture should encourage honesty and openness when it comes to conduct breach reporting as everyone’s head is on the block if there is consumer harm.
Remaining with regulation – sorry – it was also interesting to see that Aon and Willis Towers Watson have, according to the Insurance Insider, decided to sell off Willis Re in an effort to appease the European Commission and get the planned merger over the line. Interestingly, the title quoted AJ Gallagher as a potential buyer, the very same firm that had its acquisition of motorcycle specialist Bennetts crushed by the UK Competition and Markets Authority…