P&I insurers’ information duties

Under what circumstances may an injured third party claim directly from the insurer of its tort feasor? The Third Parties (Rights Against Insurers) Act 2010 will enter into force upon decision by the Secretary of State, and when it does, P&I insurers will for the first time be subject to the information duties provided for by the Third Parties Act.

Johanna Hjalmarsson

The Third Parties (Rights Against Insurers) Act 2010 which will replace the homonymous Act from 1930 received Royal Assent on 25 March 2010. Having passed through the House of Lords and the House of Commons in just over three months, it was nevertheless 10 years in the making, the Law Commissions having issued the underlying report as long ago as 2001 (LC272). The 2010 Act will, like its predecessor the 1930 Act, apply in cases of insolvency and in cases of company winding up and will allow injured third parties to claim directly against the insurer. Given the particular structure of the shipping business, with one-ship companies whose only asset may have been lost in connection with the very event that gave rise to the liability, that right is particularly pertinent. An injured person or widow cannot very well pursue a whole family of companies and its directors via Rule B attachments and arrests in the manner of a judgment creditor, as seen recently in eg Vitol SA v Capri Marine Ltd (No 2) (The Thor) [2010] EWHC 458 (Comm) and Brave Bulk Transport Ltd v Spot On Shipping Ltd [2009] 2 Lloyd’s Rep 115.