Insurers will face an avalanche of psychiatric injury claims if a review overturns a recent county court judgment.
The review could broaden the scope for psychiatric injury claims, insurance lawyers have warned.
The case was brought by one of three employees who suffered post-traumatic stress disorder after witnessing a horrific industrial accident that killed a close colleague. However the court threw the case out in July.
The claimant failed to win compensation because he could not satisfy a vital element set out in the landmark House of Lords decision in Alcock & Others v Chief Constable of South Yorkshire Police .
Weightman Vizards workplace litigation partner Noel Walsh explained that the Lords decision meant the claimant had to prove "sufficiently close ties of love and affection" to the injured party in order to be compensated.
The court accepted the workers were friends and the claimant had suffered a recognised psychiatric injury, but without sufficiently close ties, their claim failed.
The claimant petitioned the Court of Appeal for leave to appeal and failed, but the court agreed a judge would review the case.
"Should the decision be overturned by the court, insurers face a potential avalanche of claims from friends and colleagues who have witnessed horrific accidents at work and on the road," Walsh said.
Friendly' Zurich helps brokers
Zurich Insurance has been tagged the "broker's friend" in a new advertisement campaign encouraging consumers to use local brokers for motor and home cover.
Two versions are planned, 30 seconds and 10 seconds, advertising a phone number which consumers can ring. Zurich will then direct them to a local broker from a database of 1,600 "top supporting" brokers, the insurer said.
Zurich Retail Financial Services managing director Ian Owen said: "This prime-time advertising campaign will provide a boost to the broker community, actively generating valuable new business through this important channel."
The campaign begins on 4 October and will run on television, in the national and regional press, and on billboards.