Re: Winter 2013/14 - Page 61

clause which prohibited the use of heat equipment, without certain precautions being in place at the time – ones which were not there. As a result, his business had to meet the claim from the owners of the fire damaged property, severely affecting its ability to continue trading afterwards. It is vital to check the terms of the policy carefully and ensure that the insurer’s requirements are met to avoid this risk. In the current economic climate insurers are reviewing the terms of the policies in much greater detail in attempts to try and find reasons to avoid the policy, reducing the extent of their payouts. Lapsed Policy In other cases, you may have let a policy lapse, whether intentionally or by mistake. Sometimes it is an oversight to renew the policy by a certain date but on other occasions it is a conscious decision to try and save money by not taking out the policy and paying a premium in the hope that an accidents won’t occur. For struggling small businesses, this may seem like a gamble worth taking but it is a false economy. A month before dissolving his business, a builder decided to let his employer’s liability policy lapse to avoid having to pay a further premium for such a brief period of time. The odds of an accident occurring when none had happened in all the preceding years seemed remote. As you can guess, typically, in this final month, one of his employees whilst working on a building site fell from scaffolding breaking his leg and was unable to work in the same capacity for over a year. Without any insurance cover to protect him against a substantial personal injury claim and the related financial losses – mainly loss of earnings – he was faced with a significant settlement once he paid the legal costs on both sides. What to do next? If your insurer has refused indemnity and there is no prospect of reversing this decision, you will need to deal with the claim being brought against you yourself. Unfortunately, there may be strict time limits under pre action protocols or electronic portal systems which you need to comply with and this is when you need to seek legal advice. Leaving matters to fester or missing deadlines may well jeopardise your chances of either defending the claim or raising arguments to minimise any damages or costs which you may need to pay out at the end of the day. At Mayo Wynne Baxter, we are able to help you with insurance claims and will be able to advise you whether you may have any avenues of recourse against your insurance company and if not, how best to protect yourself or your business in meeting any claim. In some cases, there maybe an arguable defence making the claim worth fighting (especially if it