Insurance Contracts CP - Law Reform Commission

Chapter 9 – Third Party Rights
11.37 The Commission provisionally recommends that section 62 of the Civil Liability Act 1961
should be extended to allow a third party to proceed against the insurer where the insured cannot be
located. [Paragraph 9.23]
11.38 The Commission provisionally recommends that a third party beneficiary under a contract of
insurance should be defined in legislation as a person who is not a party to the contract but is specified or
referred to in the contract, whether by name or otherwise, as a person to whom the benefit of the
insurance cover provided by the contract extends. [Paragraph 9.36]
11.39 The Commission provisionally recommends that, in the context of third party rights in insurance
contracts, it would, in general, be sufficient to protect such rights if the Oireachtas enacted legislation
based on the draft Contract Law (Privity of Contract and Third Party Rights) Bill in the Commission‘s 2008
Report on Privity of Contract and Third Party Rights. In addition, the Commission invites submissions as
to whether additional specific provisions should be enacted in the context of the operation of insurance
contracts in specific settings, for example, in insolvency, on the death of an insured person and during the
completion of a contract for the conveyance of land. [Paragraph 9.41]
Chapter 10 Remedies
11.40 The Commission provisionally recommends that avoidance of an insurance policy should no
longer be the main remedy, and that in cases of non-disclosure and misrepresentation the principal
remedy should be one of damages in proportion to the failure by the insured. [Paragraph 10.21]
11.41 The Commission provisionally recommends that an insurer should be able to avoid a policy
prospectively upon discovery of a negligent non-disclosure or misrepresentation even if the insurer is
bound to meet any claims submitted by the insured. Should the insurer decide to exercise this right the
avoidance will be effective upon giving the insured written notice of this decision. [Paragraph 10.22]
11.42 The Commission provisionally recommends that any damages awarded to an insured arising
from the insurer‘s failure to comply with the proposed post-contractual duties of the insurer should reflect:
(a) general principles of damages in contract law, namely whether the loss is a reasonably foreseeable
consequence of the breach of contract (and in particular, damages that are reasonably foreseeable from
a refusal in bad faith to meet a valid claim); and (b) emerging principles of restitution. [Paragraph 10.42]
11.43 The Commission invites submissions as to the period of time within which an insurer should
meet valid claims. [Paragraph 10.43]
11.44 The Commission provisionally recommends that legislation should provide that subrogation
rights should be limited in two situations: (a) claims between family members and (b) the employeremployee
relationship. The Commission invites submissions as to the precise form these restrictions
should take. [Paragraph 10.101]
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