Concerted attack in Lords' debate on Compensation Bill
The government came under pressure from all sides of the insurance industry this week over the Compensation Bill.
Senior industry figures criticised the Bill for not going far enough in tackling the insurance industry's concerns.
Speaking in the House of Lords as the Bill was debated on Monday, Lord Hunt of Wirral said the government failed to address key issues in the Bill.
He said: "The Compensation Bill must become a crucial part of a robust, sustainable answer to the challenges of our time," he said. "We therefore have some work to do."
Lord Hunt said he was disappointed by the Bill which failed to grasp the complexities of the issue.
He said: "There is a tangled web out there that still needs much unravelling.
"I am also quite disappointed that the Bill contains no regulations dealing with advertising standards, or the transparency of charges and commissions received for the services being regulated."
The ABI has also been left disappointed by the Bill. Nick Starling, the ABI's head of general insurance, said the Bill "doesn't address the fundamental issues around compensation".
He said: "What you want is a system that when something goes wrong, and personal injury happens, you can sort out the simple cases. You can get people on rehabilitation, you can get the system working, speed it up, cut the costs out and that is the big prize that needs to be done."
John Greenaway, chair of the all party group on insurance and financial services, also raised serious concerns about the Bill. He called on the government to clarify who would regulate claims management companies.
He said: "If the government wants the Claims Standards Council (CSC) to be the new regulator it should say so now.
"I think the better option is to create a new statutory body in the Bill and provide the resources needed for it to succeed."
