Zurich has requested a meeting with the Lord Chancellor, Lord Falconer, to express "frustrations" over the government's handling of compensation issues.

Bill Paton, Zurich's chief claims officer, called on the government to take a "more joined up approach" to insurance legislation.

He said MPs should consider the wider implications of employers' liability (EL) cover when discussing the state of the compensation system.

Paton told Insurance Times: "The Treasury has to say that there is a bigger picture, and it should be looking at it to work out strategically where we are going to get to, because at the moment we are still feeding this hungry legal costs system."

Paton accused the government of failing to address the "cause" of the compensation system pitfalls, which is intrinsically embroiled with EL cover.

"The government has to start looking at the cause rather than the symptoms. New legislation is still not tackling the cause," he said.

Paton expressed "nervousness" at the "gaps" in the Compensation Act, which, he feared, could instigate satellite litigation when it was designed to rid the system of unnecessary legal costs.

"My biggest fear is that we are on a raft of satellite litigation for the next two to three years, and that means chaos resumes and what does that do?"

He added: "We are taking a longer-term view. Zurich will not disappear [as an EL insurer] so you have to act responsibly. In EL you have to be here for the long term. That is why I would prefer to get round the table to take the long-term view."