We haven't made the case for reform, insurers' seminar told

The insurance industry has failed to make the case for government reform of employers' liability insurance (EL), according to Royal & SunAlliance (R&SA) technical insurance manager Phil Bell.

Speaking at a seminar on EL organised by R&SA, Bell said that the insurance industry had to prove to the Department for Work and Pensions (DWP) that the case for reform was "overwhelming", but he doubted that the industry had made that case so far.

The pessimistic statement comes on the eve of the publication of the DWP's second report on the EL crisis, adding further weight to speculation that the report will not recommend many of the changes that the industry has been lobbying for, such as a separate disease pool.

Bell expected that the report would be no more than a "progress report" on the further work that was being done by various bodies.

The ABI, for instance, has commissioned a study to examine the viability of establishing a separate fund for long-tail disease risks.

He did however expect there to be "strong messages" on rehabilitation and legal costs.

Bell also highlighted changing EU capital requirements as another major issue for insurers. He said that tougher capital requirements to be introduced in the coming years would lead to "significant changes in how insurers allocate capital".

"Insurers' appetite for EL risks will diminish in the future if we are not careful. Insurers will need more capital to write EL, which will drive up premiums even further."