News story

Changes to the Third Parties (Rights against Insurers) Act 2010

The Third Parties (Rights against Insurers) Act 2010 as amended by the Insurance Act 2015 and the Third Parties (Rights against Insurers) Regulations 2016 will come into force on 1 August 2016.

Read about changes to Third Parties Act 2010

What the new legislation does

The new legislation will allow a third party to issue proceedings directly against the insurer, removing the need to restore the dissolved company in order to make a claim.

The 2010 Act modernises and simplifies the Third Parties (Rights against Insurers) Act 1930 and the Third Parties (Rights against Insurers) Act (Northern Ireland) 1930. The Act extends to the whole of the UK.

The Act:

  • has been updated to reflect changes in insolvency laws since the 1930s such as voluntary procedures
  • lists the insolvency and insolvency-type circumstances (including dissolution) in which the 2010 Act may apply to companies
  • will remove the requirement for claimants to restore dissolved companies that have been struck off the register in order to resolve claims against insolvent insured parties

Where the new law will apply

The new law will apply where a company incurred a liability:

  • and entered a state of insolvency on or after 1 August 2016
  • before 1 August 2016 and the insolvency started on or after 1 August 2016
  • on or after 1 August 2016 and the insolvency started before 1 August 2016

If both the liability was incurred and the state of insolvency entered before 1 August 2016 the Third Parties (Rights against Insurers) Act 1930 will continue to apply. In these circumstances the company will need to be restored to pursue personal injury claims.

The same rules apply where instead of entering a state of insolvency a company is dissolved under section 1000, 1001 or 1003 of the Companies Act 2006.

Further information

For more information please read The Third Parties (Rights against Insurers) Act 2010 as amended by the Third Parties (Rights against Insurers) Regulations 2016.

Published 14 June 2016