The review by LMA was carried out ahead of the Insurance Act coming into force in August 2016
The Lloyd’s Market Association (LMA) has flagged up 373 high-risk wordings in vetted policy wordings and clauses regularly used within the London market.
The findings by the LMA follow a review of the Lloyd’s Wordings Repository (LWR) to flag up model wordings that may need amendment in light of the new Insurance Act.
High risk means the wordings contain terms that will need to be reviewed or amended.
The sectors with the most wordings to review are aviation, international liability, financial institutions and ‘cross-class’ clauses.
The association said several of the flagged wordings are older clauses and any that have been superseded, or fallen out of use, can be withdrawn.
The LMA completed the search of the LWR, using target words designed to identify wordings containing terms, that may be affected by the Insurance Act.
Several hundred ‘hits’ on the LWR have been flagged for review. There are over 4,000 model wordings recorded on the LWR.
The act is due to come into force on 12 August 2016.
A detailed review of the flagged wordings will be undertaken by the LMA’s underwriting committees and the LMA Wordings Forum.
Redrafting will be undertaken by business panels, the Wordings Forum or with the aid of external guidance.
LMA non-marine manager David Powell who is leading the project said: “The LMA is continually reviewing and updating wordings.
“However, this is the largest review of model wordings in the Lloyd’s market since the LWR was created in 2006.
“With our members’ help we will be working through the lists of flagged wordings, and ensuring that the clauses are brought in line with the Insurance Act, ready for use in 2016.”
Further due diligence work will also be carried out in relation to wordings not picked up in the initial search.