The government has released an options paper for its review of insurance contract law, and industry professionals are encouraged to read and make submissions.
The options paper describes problems with insurance contract law, possible options for solving them, and the costs and benefits of those options. Among the options being considered by the Ministry of Business Innovation and Employment (MBIE) include changes on disclosure of information to insurers, unfair contract terms, and making it easier to read and compare insurance policies.
“This paper sets out some options for reforming New Zealand’s insurance contract law,” Minster of Commerce and Consumer Affairs Kris Faafoi said. “It should be read with the paper proposing options for reforming the rules governing the conduct of financial institutions, which is also currently being consulted on.”
Meanwhile, law firm MinterEllisonRuddWatts said the options paper will be of interest to anybody that provides or makes use of insurance as it considers key issues within the insurance law framework.
“Any reforms that come out of the on-going review may have a considerable impact on the insurance sector,” MinterEllisonRuddWatts senior associate Maria Collett-Bevan said.
MinterEllisonRuddWatts said the expectations it set out for a change on the duty of disclosure have been reflected in the options paper.
“[W]e still expect the end result to include some change (likely a reduction) in this duty,” Maria Collett-Bevan noted.
“It will be important for insurance companies to engage in the law reform process at this stage to ensure any law changes are fit for purpose,” she added.
Submissions close on June 28.