The UK Insurance Market Emma Sanders The Adventure Activity Insurance Scheme

1. The UK Insurance MarketEmma Sanders The Adventure Activity Insurance Scheme

2. Who we are • The Adventure Activity Insurance Scheme (AAIS) is a product of Thistle Insurance Services, part of the JLT Group. • AAIS • Based in Gloucester with a dedicated customer service team and Nationally based team of Account Executives • In house claims department • Cover placed at Lloyds of London under a binder agreement with specialist underwriters • Thistle Insurance Services Limited • Formerly Jardine Lloyd Thompson UK, now a dedicated underwriting facilities distribution business. • JLT Group • Top 10 Global Insurance Broker • Operates in 100 offices and employs more than 5,500 staff • Largest UK and European based broker quoted on the London Stock Exchange.

3. Current market • Economic down turn, resulting in soft market • Hard market, high premiums, usually after a major insurable loss, as in 9/11. • Soft market, underwriters can place business easier resulting in a levelling of premiums or savings. Most forecasters thing this will last for 2011. • Recent natural disasters could result in a hardening of the market sooner than previously thought – potentially over £100 billion in claims • The central role of insurance – providing business with the confidence to trade through tricky times, offering financial protection against worse case scenarios.

4. Review insurance cover • In spite of the competitive insurance market companies do not seem to be reviewing their insurance cover. • The current market offers a good opportunity to ensure you are getting the right cover for your business. • Companies should be looking to review their insurances and take advantage of the soft market • Directors and Officers • Business Interruption with key person cover • Increased limit of indemnity

5. Limit of Indemnity • The limit of indemnity applies per occurrence or event. • The limit of indemnity is the overall limit which the insurer will pay in terms of one accident (irrespective of how many people are injured). • Ensure you are adequately covered in terms of potential compensation claims made by all the people who could be injured in one incident.

6. Products liability • The limit of indemnity for products liability cover works differently. • This cover is subject to a limit of indemnity in the aggregate – this means the maximum the insurer will pay in any one year, irrespective of the number of claims against the policyholder.

7. Defending Liability Claims • Everyday UK insurers pay out over £7.5 million for general liability claims. • ‘Do insurers do enough to defend businesses against liability claims’? • Businesses are concerned that insurers pay out too easily. • The fact of the matter is that in many cases insurers hands are tied and they are simply not in a position to do more.

8. What can we do? • WHY? • The courts make a legal judgement NOT a moral one. • Simply believing that someone is ‘trying it on’ is not a valid defence. • It would be financial suicide for insurers to go to court without a solid defence. • Our largest pay out is nearly £300,000, against an individual. • Since 2002 AAIS has received 274 claims, but only 49 have resulted in pay out – that's less than 20%.

9. No win – no fee • Although there is no doubt they encourage litigation, these solicitors do not work for nothing. • They only push claims if they have a good chance of winning. • In this contexts our 80% success rate in rejecting invalid claims is impressive.

10. The best defence • In law any business that invites people on to its property has a duty to provide a safe environment. • You must be able to present evidence that steps have been taken to avoid any dangers. • Unfortunately, even evidence of safe operations will not guarantee that the defence of a liability claim will be successful. • However it will provide the insurers with the evidence to make the best possible case.

11. Questions

12. Claims • Recent claims FACTAL Accident – Water Rafting • All the correct procedures where in place, the staff had received appropriate training who responded well to the emergency – deemed an unfortunate accident. INCIDENT – Serious injury to employee • A fall from height resulted in catastrophic injuries, it was a genuine claim so to allow individual and partner to move on a settlement was negotiated for rehabilitation costs. INJURY – High ropes course • Provider was being sued by a Local Authority and Health & Safety Environmental Department, but was successful defended by their insurance cover.

13. Claims • INJURY – low rope course • Participant broke ankle whilst moving around course. There was no defect equipment and the appropriate instruction was given. Unfortunately the Environmental Health Officer attended and made impractical recommended to amend the course. This spurred on the individual to claim and it was eventually settled out of court for £42,500.

14. Adventure Activity Insurance Scheme a division of Thistle Insurance Services Ltd Authorised and regulated by the Financial Services Authority a member of the Jardine Lloyd Thompson Group PLC 6, Crutched Friars, London EC3N 2PH Whilst all reasonable care has been taken in the preparation of this presentation no liability is accepted under any circumstances by Jardine Lloyd Thompson for any loss or damage occurring as a result of reliance on any statement, opinion, or any error or omission contained herein. Any statement or opinion reflects our understanding of current or proposed legislation and regulation, which may change without notice. The content of this document should not be regarded as specific advice in relation to the matters addressed.