What Are Unfair Terms In Insurance Contracts?

The United Kingdom's Financial Services Authority (the "FSA") recently published a notice of an undertaking given by AXA Insurance UK plc ("AXA") under which AXA agreed not to use certain terms in its contents and buildings insurance policies. These terms, the FSA found, were considered to be unfair under the UK Unfair Terms in Consumer Contracts Regulations 1999. 

Given the Irish Central Bank's increased enforcement priorities, the FSA's guidance should provide a useful guide for insurers in Ireland as to terms that might be deemed to be 'unfair' by the relevant authorities. 

It is also important to remember that in addition to the Central Bank's administrative sanction authority, failure to adhere to the requirements of the European Communities (Unfair Terms in Consumer Contracts) Regulations 1995 (the Irish equivalent of the aforementioned UK regulations) is of itself an offence which could result in monetary fines and sanction by the Director of