Third Parties (Rights Against Insurers) Act 2010 Due To Come Into Force

The Act, which received Royal Assent as long ago as 25 March 2010, is finally due to come into force on 1 August 2016. It has the intention of allowing third parties to make claims directly against liability insurers in insolvency situations.

1930 Act

The new Act overhauls the 1930's Act of the same name, which contained certain onerous conditions on claimants, including requiring the claimant to first bring a claim against an insolvent insured prior to bringing a claim against the insurer.  This required the claimant to apply to restore the insolvent insured to the Companies Register.

The validity of the claim and the amount of liability also had to be first established by judgment, thereby meaning the Claimant had to bring two actions which increased costs and time.