Insurance is a type of risk management where risk of a loss is transferred from one party to another, through payment of a premium. Reinsurance involves insuring the insurer - usually where large amounts of money are at stake – passing on the risk again.
Companies use insurance for their larger commercial activity, such as investment management, and merger and acquisitions.
What is Insurance Law?
Insurance Law can be split into many sub-specialisms. Insurance lawyers mainly deal with insurance against the destruction of assets, and insurance against mistakes made by professionals. Insurance cases vary and can range from small local cases to massive international disputes.
What is Reinsurance Law?
Reinsurance law in the UK is regulated the same way as primary insurance. The English law on insurance contracts generally applies to reinsurance contracts. The Insurance Act 2015 applies to non-consumer insurance and reinsurance contracts.
Types of law practised in insurance and reinsurance law
Insurance covers a variety of risks, which means that it includes issues from different law sectors such as employment, shipping, property, construction and professional services. Insurance policies are contracts, including a body of insurance statutes, regulatory rules and case law.
What does an insurance lawyer do?
To a large extent, this will depend on the type of firm you are at and the type of clients you have. For example, you may be acting for individuals who are bringing claims against their insurance companies for rejecting claims on their policies.
At the big business end of insurance law, large firms usually act on behalf of the insurance or reinsurance companies on a wide range of activities, from advising companies on claims being made against them, to the transfer of business between insurers as a result of a merger or acquisition.
Insurance lawyers review claims being made on behalf of, or against, their client and advise their client on the likely strength of the case. If things turn contentious, claims can be pursued either by arbitration or in the courts.
What skills are required?
This is an area of law in which contract law features heavily, so you will need a good grounding in this area of law, an eye for detail and excellent drafting skills. Commercial awareness is important to enable lawyers to understand their client’s situation and make sound business judgements. You will need to understand contract law including policy drafting and assessing potential breaches of warranty.
As with many areas of law, communication and team working skills are a prerequisite.
How to become an Insurance Lawyer
If you would like to become an Insurance Lawyer, you need to complete a law degree or non-law degree followed by a conversion course. Then you take a one-year vocational course known as the Legal Practice Course (LPC) followed by a two-year training contract. Insurance law should be selected as an elective during your LPC. Most training contracts are with a firm of solicitors, an in-house legal department, or a local authority.
From September 2021, the Legal Practice Course will be replaced by the Solicitor Qualifying Examination (SQE) to qualify as a solicitor in England and Wales.
Insurance Law & Practice
The insurance industry is well established and has its own rules and terminology. The Financial Conduct Authority regulates the industry. Some law firms specialising in insurance law regularly act for both insurance companies and insured policyholders. However, there is a trend towards firms specialising in either policyholder or insurer work.
Both insurance companies and consumers need lawyers that are experts in the insurance field. Insurance lawyers are litigators, but they might also work in compliance or lobbying. Solicitors specialising in insurance law have a stable career where they can use their communication and litigation skills to advance their clients’ interests.There are many opportunities to move around in the insurance market, and a large variety of work is available.