Insurance Bill [HL]

Lord Woolf Excerpts

Thursday 8th January 2015 Lords Chamber

[Lord Newby (LD)]

My Lords, in moving Amendment 1, I shall also speak to Amendment 2. In the amended Bill, Clause 4(6) provides that, for the purposes of the duty of fair presentation of the risk, the insured “ought to know” what should have been revealed by a “reasonable search of information” available to it.

Some of the evidence we heard in Committee made the case for the Bill explicitly confirming that the “reasonable” search may extend to persons covered by the insurance contract but who are not the insured in the sense of being a contracting party. Noble Lords will recall that my noble friend Lady Noakes and the noble and learned Lord, Lord Woolf, put forward amendments to this clause in Committee stating that the reasonable search may extend to persons who could benefit from the contract. The Government were unable to agree with the specific wording of those amendments, and they were subsequently withdrawn.

However, we agreed to take the issue away and consider whether amendments needed to be made to ensure that the intended scope of the clause is clear. The Government consider that such clarification would benefit the Bill, and Amendments 1 and 2 seek to address this issue. As we discussed in Committee, what is a reasonable search of information will depend on the type of cover an insured seeks and the type of entity it is. It is important that Clause 4(6) expresses a broad principle that is flexible enough to take account of the wide variety of insurance policies and types of cover which are bought in the non-consumer context.

Amendment 2 clarifies that “information” which an insured ought to know may include information held by a person other than the insured, specifically mentioning that this may include,

“a person for whom cover is provided by the contract of insurance”.

This makes clear that persons benefiting from the contract could come within the scope of the insured’s reasonable search. I believe that this was at the heart of the amendments put forward by my noble friend Lady Noakes and the noble and learned Lord, Lord Woolf, and I hope that they are content with the drafting we have produced on this in Amendment 2. These amendments will improve the Bill, and I hope that the House can support them. I beg to move.

[Lord Woolf (CB)]

My Lords, in accord with the approach adopted by the Minister throughout the discussions on this Bill, I would like to acknowledge the help that he gave, which was something that I and the noble Baroness, Lady Noakes, were looking for.

Amendment 1 agreed.