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Daily Insurance Industry News
Saturday 20th of January 2018
May 13, 2008

Lloyd’s warns of liability crisis for business

by Gill Montia

Story link: Lloyd’s warns of liability crisis for business

Lloyd’s of London has published a report highlighting the dangers of a liability crisis, should businesses fail to get to grips with litigation issues.

The report accompanies the launch of the third series of Lloyd’s 360 Risk project, which provides a forum for debate about key risk issues and their management.

The paper entitled “Directors in the Dock – is business facing a liability crisis?” suggests that businesses are not devoting enough time to the discussion of liability issues and are not sufficiently prepared for future liability risks.

The authors of the report found that business leaders are increasingly concerned about the rise of a US style compensation culture in Europe and Asia and the liability issues emanating from the credit crisis.

They point out that operating environments are becoming more complex, increasing the price of some products and services and possibly stifling innovation and risk taking.

For example, product recalls have risen 50% in Europe in the past year, the introduction of the Corporate Manslaughter Act has redefined health and safety issues and shareholder activism is gaining strength.

Lloyd’s research found that European business leaders expect to spend more time on litigation-related issues over the next three years, with 39% of those surveyed expecting the cost of their products and services to rise because of the growing risk of litigation.

 

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