Mactavish warns that in-house counsel are overlooking employers’ insurance requirements
Insurance consultancy firm Mactavish has warned that many in-house legal counsel are overlooking the insurance requirements and risks facing their employers, wrongly believing this is the responsibility of their colleagues in the finance or risk departments.
Mactavish’s data suggests that 45 per cent of large commercial claims are currently disputed by insurers and that on average they take three years to resolve, with settlements of around 60 per cent of the initial estimated values.
Bruce Hepburn, CEO of Mactavish said: “On too many occasions, we have seen in-house legal counsel neglect their duties in this area, leaving their employers and themselves exposed.”
Mactavish warned that regulatory developments such as the Insurance Act 2015 and the update to the Corporate Governance Code earlier this year, mean company directors and legal counsel need to be more aware of the risks facing their organisations, but many have a poor understanding.
Mr Hepburn added: “In-house counsel need to have a solid understanding of basic insurance law issues. If their employer needs to make an insurance claim, the legal department’s ability to spot issues and help guide the process can mean the difference between a quick pay-out or a long court battle with the insurer.
“They do not have to become an expert in insurance law expert, but they do need to know the basics, and when they should get external help.”