Forum Brief: Pre-Budget Report - Insurance

The Department for Work and Pensions is to undertake a formal review of the operation of employers' liability insurance.

Forum response: Construction Products Association

Michael Ankers, chief executive for the Construction Products Association, said: "Although the chancellor has announced a review of employers' liability insurance, we had hoped that he would recognise the serious impact that the dramatic increase in premiums is having on many businesses by reducing the level of insurance premium tax.

"However, the proposed review of this compulsory insurance is welcomed, and we hope that it will report promptly. Business needs government action as a matter of urgency."

Forum Response: Association of British Insurers

Mary Francis, director general of the ABI, said: "Insurers welcome this review - it is what we have been calling for. This review is a once in a generation opportunity for claimants, employers, insurers and the government to create a better system of workplace compensation.

"The existing system of workplace compensation isn't working, won't work and needs to be reformed. Claimants are uncertain about their entitlements. Rehabilitation is not a priority. Health and safety standards are too low. Claims costs are soaring. And too much money is siphoned off in legal fees.

"The ABI has been working hard with others to help with short-term problems of premium increases. But the significant questions are all long-term. This review must grapple with funding for occupational diseases such as asbestosis and the case for a no-fault system.

"Only a comprehensive look at the long-term issues will enable the government to answer any of the immediate or more fundamental questions."

Forum Response: ACCA

Chas Roy-Chowdhury, head of taxation for ACCA, said: "ACCA welcomes the review of employers' liability insurance, the increasing cost of which is threatening many firms' survival."