Chris Sharrock, of law firm Kennedys, looks back over the last few years and charts the growth of a new phobia, a new industry, even a new word – Y2K.

Mention Y2K to your average punter three or four years ago and he wouldn't have had a clue what you were talking about. I guess the same applies to most businessmen and professionals, with the exception of those anoraks who have been hiding a dark secret from us.

Mention Y2K now and everyone is aware of the issue, even if they haven't done anything about it. Indeed, those poor unfortunate souls whose task it is to ensure that their business operations are Y2K ready are no doubt thoroughly fed up with the whole problem. I suspect that Y2K fatigue has even hit the army of professionals who have been making a small fortune out of their newly-acquired Y2K expertise.

General public awareness of the Year 2000 problem has only been with us for the last couple of years. I can distinctly recall my own feelings of disbelief that the problem existed at all and that the underlying cause was so blindingly obvious. But, once the message had sunk in, I, like many others, embarked upon a course of preaching to the uninitiated. My file of Press cuttings grew steadily until I decided to cancel my standing order to the library to send me all Y2K-related material because I was simply being inundated with paper.

Predictions of apocalypse
First, there were the doom-mongers. Tales of Chernobyl revisited and the unleashing of the world's arsenal of nuclear missiles began to proliferate in the Press. There was talk of possible financial meltdown as well, as the global financial markets became gridlocked through the failure of one or two key players in the banking system. Then there were the usual tales of aircrafts falling out of the sky and the pessimists taking to the hills in Scotland.

As we now approach the immovable deadline, the perceived wisdom (if we are to believe what we are told) appears to be that, whilst there may be some minor disruption in the western world, life will probably continue pretty much as normal. A rather larger question mark is left hanging over the heads of those who live in less developed countries which have not had the expertise or financial resources to take the necessary corrective action. Don't expect to be able to phone home from some of the remoter regions of the world in the early hours of the New Year unless, of course, you have at your disposal the latest high-tech mobile communications gadgetry.

Looking back over the past few years, it is perhaps surprising that the UK Government was so slow to act in promoting awareness of the Year 2000 problem.

Whilst the Government still maintains that it appointed its own team of advisers, in the form of Taskforce 2000, to promote general public awareness, the reality is that it appointed one individual, Robin Guenier, on a limited budget and then ignored what he was saying when it did not like what it heard - namely a clear and unequivocal call to industry to take the problem seriously and take immediate steps to implement corrective action.

This gave rise to the birth of Action 2000 which, largely through the efforts of Gwynneth Flower, has been able to deliver the message to a much wider business audience, focusing in particular on small-to-medium sized enterprises. Critics will say, however, that it was very much a case of too little, too late.

Insurers slow off the mark
The UK insurance industry was also slow to react to the problem which enabled well-briefed insurance brokers to steal a march on insurers by arranging three-year insurance policies for some of their larger clients without any form of Y2K exclusion.

Once insurers woke up to the fact, there was an automatic knee-jerk reaction, with many insurers deciding to impose so-called total exclusions in respect of any claim or loss arising from, or even remotely connected with, the Year 2000 problem.

A debate then took place within the insurance industry which led to a more rational approach being adopted by a number of insurers which indicated that they were prepared to underwrite Y2K risks if they were provided with adequate information to enable them to assess the risk they were being asked to cover.

Then lawyers jumped on the bandwagon and began to produce all manner of Y2K questionnaires for the benefit of their insurance clients. More lawyers were called in to advise their corporate clients on whether to answer the Y2K questionnaires and, if so, how.

In practice, after much huffing and puffing, and very little being committed to writing, most insurers have agreed to write some element of Y2K coverage, even if inner limits of indemnity have been applied to reduce their overall exposure.

In many cases it was simply a case of commercial reality: write the business and retain the client or impose an exclusion and the client will go elsewhere. No problem if you have the financial clout to dictate such terms to your insurers, but bad luck if you are an individual or small business.

In some instances, insurers have simply imposed Year 2000 exclusions during the currency of the insurance contract, presumably in the hope that their insureds won't notice, won't understand or simply won't be bothered to seek better terms elsewhere. So much for freedom of contract when onerous terms can be imposed unilaterally during the currency of a contract.

Legal feeding frenzy
I've already made some reference to the opportunities that the Y2K problem has presented to the legal profession. Indeed, I recall the title of one of the earlier talks I was asked to give on the subject: Y2K - A Feeding Frenzy for LawyersNULL The deliberate reference to our oceanic brethren was entirely justified because the Year 2000 problem spawned an entire mini-industry for lawyers.

They were asked to consider and advise upon the definition of Year 2000 compliance and to draft an array of business questionnaires seeking warranties from manufacturers or suppliers that a particular piece of kit would continue to operate beyond December 31, 1999. Moreover, for every 100 lawyers retained to draft these questionnaires, another 50 were probably retained to respond to them. BandwagonNULL Gravy train more like!

Conferences
Talking of gravy trains, what about the conference organisersNULL Rich pickings here! First came the conferences which sought to explain the problem. Then, when that topic had been exhausted, they moved on to a series of conferences which always commenced with the words Implications of the Year 2000 problem for ..., thereby enabling them to tailor the same basic material to the needs of a particular industry or profession.

When the Year 2000 finally arrives, we'll doubtless be bombarded with conference flyers encouraging us to be the first to hear all about a variety of Y2K related defects from yet another panel of experts.

Last, but by no means least, there are the Y2K jokes winging their way through cyberspace to all corners of the planet. It's ironic to think that, unless you have a fully prepared microchip, your daily dose of humour could disappear forever. Some might argue that this must be a good thing because of the enormous amount of business time that is wasted in reading or, worse still, writing junk e-mail.

We were also authoritatively informed that the Year 2000 problem was not a new phenomenon. Indeed, a similar problem had been encountered by the Romans 2000 years ago, when concerns were expressed as to whether their slaves would stop working or whether the wheels would fall off their chariots!

You ain't seen nothing yet
But the important thing to remember is that the real action hasn't even started yet! If everything we've seen thus far is merely for starters, it does leave you wondering what the main course will be like. Assuming we still live in a nuclear-free zone, I foresee a sharp rise in claims activity and dispute resolution procedures which in turn will impact on the insurance industry and probably lead to higher premiums all round.

I, for one, will be resisting the temptation to abuse my credit card at some outrageously priced celebration of the turn of the century and will be seeking the company of a select group of friends in the comfort, central heating permitting, of my own home. If I do venture out it will only be to the nearest pub that can offer me a decent pint of beer, courtesy of a hand pump. Y2K in Le Touquet? Whilst I have every confidence that Le Shuttle will still be operative, I shall be enjoying the millennium experience chez moi.

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