5. News from the Working Parties

REINSURANCE WORKING PARTY , 22 October 2002

1. ATTENDANCE

The meeting was well attended and in addition to the members of the Working Party, a large number of other members of AIDA attended the meeting.

2. MOCK ARBITRATION

The main business of the meeting was a mock arbitration on issues arising from September 11, in particular the meaning of "event" and the recoverability of declaratory judgment costs. Counsels were Vince Vitkowsky and Reinhard Dallmayr, opposed by Kathy Posner and Michael Mendelowitz, who made simultaneous representations to a US arbitral tribunal consisting of Bob Mangino, Mark Gurevitz and Bob Hall and to an international arbitral tribunal consisting of Michael Gill, John Butler and Theo Dielmann. Both tribunals ruled that the destruction of the WTC was one "event", although the international panel would have disallowed the recovery of declaratory judgment expenses while the US panel would have upheld that claim.

3. REPORT ON PROGRESS OF QUESTIONNAIRES

Questionnaire 4: Event (Michael Mendelowitz). Fourteen responses received. The report will be submitted for publication as soon as the updated US response, taking into account the WTC litigation, has been received.

Questionnaire 5: Custom and Practice (Kathy Posner). Fourteen responses received. More responses are required. The Australian response has now been received, although the response from Sweden is awaited and the response from Spain has yet to be translated into English.

Questionnaire 6: Cut-Through and Transfer Reconstruction Issues (Michael Gill). Twelve responses received. The draft report has been prepared and circulated for comment. Any responses should be sent to Michael Gill and copied to Colin Croly by the end of November 2002. The US response has been promised by that date.

Questionnaire 7: Intermediaries (Rob Merkin). Eleven responses received. The preparation of this report will be delayed until details of the UK regulatory system for brokers, due to be changed in the next year, has been announced.

Questionnaire 8: Limitation (Peggy Sharon). A draft of the questionnaire has been circulated, and will be revised in the light of comments. A copy of the revised questionnaire can be accessed here.

4. NEXT MEETING

The Working Party agreed to accept the invitation of CILA to meet at the next CILA Conference, in Rio. The meeting will be on 2nd May 2003. Colin Croly invited National Chapters to consider whether it would be appropriate to hold Working Party meetings at any of their forthcoming events.

AIDA Pollution Products and New Technology Working Party, meeting in New York, 24 October 2002

For a full text of these minutes, please click here

Preliminary consideration of responses to GMO questionnaire

In summary, the Working Party discussed the following:

• GMO regulations in Europe and restrictions on GMO risks around the world;
  
• The definition of pollution in the UK's Jan de Null case, which compared with a GM seed that causes physical damage;
  
• English common law remedies, such as the rule in Rylands v. Fletcher;
  
• The possibility of large subrogation actions against people who release GMO's
  
• Whether it is too early to assess GMO's as there has been no major damage from them or from electro-magnetic fields;
  
• Whether GMO's are an environmental hazard/is damage by a GMO to be regarded as 'pollution'.

Responses to the questionnaire from Switzerland, Belgium and the UK were discussed in the context of the above points. Further responses were requested, including, if possible, common law, tortuous and product liability cases as well as covers available.

There may be a possibility for this working party and the Prevention and Insurance Working Party to co-operate on their respective work into GMO's.

Preliminary discussion of "Environmental Damage" questionnaire - Study Number 23

1. This questionnaire was prepared by Giovanna Volpe Putzolu (Italy) and could be a model for the GMO study. In relation to environmental damage, there have been a lot of developments in the UK and the EC, particularly on pollution. This is a highly relevant area and the question remains whether environmental damage is compensatable apart from in the US and Italy.
   
   National developments
   
   

2. Awareness is growing in South Africa regarding mould claims, and they are also a big problem in the US, particularly against consultants after buildings have been erected or renovated where people are allergic to mould spores. As a consequence, these claims affect professional liability policies. It was stated, that in the UK it is not a big problem because household policies exclude damage by mould.
   

3. In the UK a new wave of asbestosis claims is the expected result of the House of Lords decision in Fairchild v Glenhaven Properties . Also the Control of Asbestos at Work Regulations come into effect next year affecting all UK commercial landlords who do not remove asbestos on their premises. Pollution issues such as the increasing degree of regulation in the UK in relation to landfill and waste management; the fallout from foot and mouth burial sites; the UK's "fridge mountain" were also quoted. Flooding is a very topical issue throughout Europe. Last winter severe floodings in the UK led to the UK government pledging a further £150 million to fund work on flood defences but there are questions as to whether household insurers can be persuaded to drop their proposed moratorium on flood cover in high risk areas.
   
   

4. The impact of Human Rights Act cases in the UK in the context of pollution claims was also considered. Two cases were mentioned: Marcic and Hatton.

5. It was confirmed that human rights are becoming very topical in South Africa particularly in relation to pollution claims against developers and might be an interesting future study.
   
   Working Party's website and bulletin board on the AIDA website

   Members were asked to submit photographs and bibliographic details for inclusion together with our studies for the proposed site.

   Membership issues including recruitment of new members

6. The Working Party needs to consider extending/expanding its membership. Three members per country would be ideal - an insurance member; a lawyer in private practice; and an academic member. Their National Chapter currently puts people wishing to become members forward.

   Date and location of next meeting

7. A possibility of a next meeting in September in South Africa in Pretoria was suggested.

THE MOTOR INSURANCE WORKING GROUP MEETING IN SINAIA

The Motor Insurance Working Group met again in Sinaia, Romania, hosted by the Romanian Association, on May 1 through 3, 2002, in order to organize the surveys to be presented at the New York Congress.

The representatives of ten Countries (namely Great Britain, France, The Netherlands, Germany, Austria, Italy, Yugoslavia, Albania, Bulgaria) participated in the Sinaia meeting. In addition, some forty managers and senior officers of insurance companies operating in Romania were invited to attend and thus had an opportunity to acquire information on motor insurance developments worldwide and to obtain useful data for a comparison with their respective national situations.

Dr. Armando Zimolo, Chairman of the Group, expounded on the non-stop updating work being done on the initial survey 'Normative and management characteristics of third party liability motor insurance in the world', the purpose of which is a comparison among the legal frameworks and market practices of the 131 Countries that, through their AIDA Chapters, Supervisory Authorities, national insurance associations or even individual insurance companies, have answered the some fifty questions included in two basic questionnaires and, upon request from the team working on the survey, supply additional information on legislation developments and on the economic and market growth of motor insurance.

The trends in compensation of bodily injuries were dwelt upon in detail in the report of Dr. Dieter Pscheidl, Vice President of the Working Group, who is preparing an international comparison among the main European Countries which is meant to supplement the report presented at the Marrakech Congress by an in-depth exploration of one of the issues of the basic report.

Also Jan Misana, the other Vice President of the Working Group, described in his presentation the close scrutiny dedicated to individual issues of the basic work underway at present, with special reference to the subject of minors protection in case of road accidents, focusing on the role of the care manager specifically.

Dr. Jean Louis Marsaud, Deputy Secretary General of CEA-Comité Européen des Assurances took the opportunity to further stress the importance of the fight against motor insurance frauds which sees all markets involved, even though the various Countries' approaches to it may vary depending on its criticality. Dr. Marsaud analysed the data relevant to European Countries, describing the prevailing typologies and expounding on the measures adopted in these Countries. Dr. Marsaud emphasized that CEA shall invigorate its action of information to and coordination among the individual national associations in order to fight successfully against such a criminal phenomenon which, rather than companies, is seriously detrimental for policyholders who are made to pay for it by means of unavoidable tariff rates increases.

Finally, also the AIDA News May issue was presented at the Working Group meeting in Romania, as every six months this publication provides information on the activity of the Working Group and on the main worldwide innovations in the field of motor third party liability.