The prevailing legislation concerning work with asbestos in the UK is The Control of Asbestos Regulations 2012, but it is interesting to note that the first piece of asbestos legislation was introduced in 1931. The first cases of “asbestosis” were seen as early as 1900 although this was not a recognised term at that time. The first published asbestos related death was Nellie Kershaw in 1924, a woman who had worked in an asbestos textile factory for some years. Asbestos cloth was woven into protective clothing because of its fire resistant properties. The report showed that her occupation had led to extensive lung damage. The term “asbestosis” was first used in 1927.
In the second decade of the 21st Century, we were living with the long tail health consequences of unsafe practices before 1980, connected with the manufacture, the use of, and contact with ACMs (Asbestos Containing Materials). On the relatively lighter side, we have the phenomenon of pleural plaques. Sadly, there were 2542 mesothelioma deaths recorded in the UK in 2015, and the numbers are likely to stay at around that level until 2020. There is a direct connection with the inhalation of asbestos fibres and mesothelioma. A smaller amount of deaths are attributable to asbestosis, and contact with asbestos fibres is a possible, or contributing, cause of many deaths from lung cancer.
In recent years the 2012 Regulations updated the 2006 Regulations because it was felt that the latter did not adequately reflect current EU legislation. The main change was the requirement for some non-licenced work to be notifiable with related requirements for medical surveillance and record keeping.
The HSE describe work requiring a licence as work:
- where exposure to asbestos is not sporadic and of low intensity; or
- where the risk assessment cannot clearly demonstrate that the control limit will not be exceeded i.e. 0.1 asbestos fibres per cubic centimetre of air (0.1 f/cm3) (averaged over a four hour period); or
- on asbestos coating; or
- on asbestos insulation or asbestos insulating board where the risk assessment demonstrates that the work is not short duration work.
“Short duration work” is where work with the relevant materials is not more than 2 hours in a seven day period and where no one person works for more than 1 hour out of that 2 hour period. Examples of short duration work could include some asbestos removal work, all work relating to sprayed asbestos coatings or pipe lagging and most work relating to asbestos insulation or asbestos insulating board (AIB).
Other work with asbestos can be undertaken by non-licenced contractors, but because some work is not possible without disturbing asbestos fibres, this will still be notifiable. Regulation 3 (2) stipulates when work is not notifiable as:
- the exposure to asbestos of employees is sporadic and of low intensity; and
- it is clear from the risk assessment that the exposure to asbestos of any employee will not exceed the control limit; and
- the work involves:
a. short, non-continuous maintenance activities in which only non-friable materials are handled, or
b. removal without deterioration of non-degraded materials in which the asbestos fibres are firmly linked in a matrix, or
c. encapsulation or sealing of asbestos-containing materials which are in good condition, or
d. air monitoring and control, and the collection and analysis of samples to ascertain whether a specific material contains asbestos.
Any work with asbestos that does not require a licence but falls outside the above criteria will be notifiable to the appropriate authority prior to work commencing. In addition to this, there must be medical surveillance with medical examinations at regular intervals but at least once every three years. The records are to be kept for 40 years, which is similar to the requirements for licenced workers.
In March 2017 a contractor was held liable for breach of these regulations. This related to a demolition contract where the contractor had obtained an asbestos survey but failed to follow the advice of using a licenced contractor. The contractor was held to be in breach of Sections 5, 7, 8 and 16 of the Regulations.
What are these Regulations? There are too many to go through in this article, but Part 2 of the Regulations relates to the general requirements which consist of Regulations 4 to 24 which are:
- Duty to manage asbestos in non-domestic premises
- Identification of the presence of asbestos
- Assessment of work that exposes employees to asbestos
- Plans of work
- Licencing of work with asbestos
- Notification of work with asbestos
- Information, instruction and training
- Prevention or reduction in exposure to asbestos
- Use of control measures
- Maintenance of control measure
- Provision and cleaning of protective clothing
- Arrangements to deal with accidents, incidents and emergencies
- Duty to prevent or reduce the spread of exposure
- Cleanliness of premises and plant
- Designated areas
- Air monitoring
- Standards of air testing and site clearance
- Standards for analysis
- Health records and medical surveillance
- Washing and changing facilities
- Storage, distribution and labelling of raw asbestos and asbestos waste
Any business that is involved with asbestos or could come into contact with asbestos during their activities should know their responsibilities and duties under the Regulations. In general, though these are to:
- carry out an investigation prior to work to ascertain the likelihood of the presence of asbestos and its condition;
- undertake a risk assessment and devise a plan of work;
- ensure that all employees that will come into contact with asbestos have the proper instruction and training;
- prevent or reduce, as much as possible, the spread of asbestos fibres during the work.
A breach of the regulations does not just mean trouble with the Health and Safety Executive, but it is more than likely to affect any insurance pay out too. It is usual for asbestos cover to be conditional on compliance with the current legislation and any breach could result in no claim payment.
Of course, the regulations do not just apply to contractors. Persons or organisations that own property or are responsible for maintenance of property (Dutyholder) also have responsibilities.
For more information http://www.legislation.gov.uk/uksi/2012/632/regulation/3/made
The shocking story of the Grenfell Tower fire starts with the £10m refurbishment that took place between 2014-16. Despite the amount of money invested in the building, residents’ safety concerns were ignored and sprinklers were not installed. Instead, cladding was added to make the building look more attractive and improve insulation. Solid foam boards coated in aluminium rainproof sheets were spaced 30mm apart across the 24-storey building, which housed 120 flats and at least 500 residents.
The tragic blaze is thought to have caused at least 80 deaths and led to 158 families being evacuated and in need of rehousing. A further 650 households were told to leave their homes immediately after fire inspectors deemed five tower blocks in a housing estate in north London as ‘at risk’. And the consequences of the fire are set to affect further families across the country, as the Government has since revealed that samples from various other buildings have failed fire safety checks.
The repercussions of Grenfell will play out for several years, but there will undoubtedly be immediate effects for those involved in cladding or façade work. Generally, cladding contractors pay a higher professional indemnity premium than others in the building trade due to the increased risks associated with their jobs. The expense involved in removing, redesigning and replacing broken or damaged cladding is further complicated with the new fire risk that has been identified.
Despite the vast UK insurance market, the volume of professional indemnity insurers willing to accept the risks of cladding contractors has always been reduced, and this has dramatically decreased post-Grenfell. This could impact any trades involved in the design, construction or refurbishment of buildings over 18 metres, not just those directly involved like cladding specialists or the main building contractor. Insurance may also become more challenging and expensive for architects, sub-contractors, project managers and health and safety consultants.
Although insurers are still formulating their approach post-Grenfell, we’re seeing professional indemnity insurers asking detailed questions to those involved in the construction sector. Examples of the type of questions being asked are:
1. Do you have any involvement in cladding or façade work?
This includes the construction and refurbishment of high-rise tower blocks, both commercial and residential.
2. Can you confirm the materials used are either fire resistant or non-combustible and that they conform to the manufacturer’s recommended use of the product and comply to building regulations in place at the time of build/refurbishment?
First published by the British Standards Institution (BSI) in 2002, the BS 8414 test methods were developed by the Building Research Establishment (BRE). They evaluate whether a cladding system subject to fire breaking out of an opening (such as a window) in an external wall, will result in excessive fire spread up the outside of the building and the potential for fire to re-enter at a higher level.
The use of new and innovative products for cladding buildings has given rise to concerns about fire performance, as these systems are often less well understood than more traditional construction materials. The Grenfell Tower fire has illustrated the importance of adequately testing external wall systems on a realistic scale.
3. Can you confirm that you have not been involved in the design, use or installation of aluminium composite panels?
Aluminium Composite Material (ACM) panels are a commonly used product in the refurbishment industry.
These additional and detailed questions will undoubtedly affect the purchasing of insurance. Contractors, architects and other building trades should perform a review of their past work to identify where they’ve used or recommended any problematic materials. Similarly, when policies are due for renewal, discussions should start as early as possible so time doesn’t run-out and insurers questions are prepared for in advance.
This is a very complex and unfolding situation and during this period of uncertainty it is essential to maintain a good relationship with the current insurer and fully respond to any questions they pose. The current insurer will be in the best position to offer renewal terms, possibly the only option as new insurers decline to take on other insurers’ risks. Failing that, Miles Smith has access to specialist insurers in the London market who may consider offering terms on a case-by-case basis, including providing assistance on excess layers where the current insurer has reduced their policy limit at renewal and a top-up is required.
We’ve already experienced the hottest June day since 1976 and with temperatures set to soar throughout the rest of the summer months, the heat will be on for tradesmen. Employers who are responsible for people who work outside for long periods have a duty to keep their employees safe in the sun.
Exposure to ultraviolet (UV) radiation from the sun can cause skin damage, including sunburn and blistering, which in the long term can lead to skin cancer. None of these conditions result in a happy workforce, but worryingly skin cancer is the most common form of cancer in the UK, with over 100,000 new cases being diagnosed and 2,500 people killed each year. With construction workers accounting for 44% of deaths from skin cancer, UV radiation should be considered an occupational hazard for those people who work outdoors, such as builders, carpenters and landscapers.
Employers should take steps to inform their workforce of the dangers of sun exposure and put guidelines in place to protect their employees:
- Encourage workers to keep covered during the summer months. It is tempting to wear less clothing in the heat, but wide brimmed hats and long sleeved shirts can offer protection.
- Promote the importance of using sun screen to any part of the body that can’t be covered up.
- Schedule work to minimise exposure during the hottest part of the day, typically between 11am and 3pm, and encourage breaks to be taken in the shade.
- To avoid dehydration plan for increased water breaks and supply water if necessary.
Although the Approved Code of Practice suggests the minimum temperature in a workplace should be above 16C, there is no statutory upper limit. The TUC (Trades Union Congress) are calling for regulations to be put in place that would allow workers to go home if the temperature of their workplace reached 30C (or 27C when doing physical activity). They are proposing that employers should be legally obliged to provide water, breaks or air conditioning to combat “uncomfortably high” workplace temperatures.
The TUC’s general secretary Frances O’Grady says: “While many of us will welcome the sunshine and warm temperatures, working in sweltering conditions can be unbearable and dangerous.
“Employers can give their staff a break by relaxing dress code rules temporarily and ensuring staff doing outside work are protected.
“Obviously shorts and flip flops won’t be the right attire for all workers, but no one should be made to suffer unnecessarily in the heat for the sake of appearances.”
Until such maximum temperature regulations are in place, tradesmen can rely on the guidelines set out in the Management of Health and Safety at Work Regulations 1999. This requires employers to make a “suitable assessment” of the risks to the health and safety of their employees and take action “where necessary and where reasonably practicable”.
How Miles Smith can help you
Miles Smith London Market Broking (LMB) offers an incredibly flexible tradesman scheme that provides a solution for smaller to mid-range contractors for all trades. With minimal exclusions and an intelligent underwriting attitude, LMB will work with you to provide your clients with bespoke cover to suit their needs.
An empty property not only impacts earning ability, but left unoccupied and unkempt, can seriously affect the value of the asset too. It is in a landlord’s best interest to continue to maintain a vacant property, to minimise the risk of damage and to secure future rental income.
So, what are the risks landlords will face when a property is empty between tenants? The first issue which must be addressed is the increased risk of vandalism, burglary and squatters. Even empty properties still have valuable items such as copper piping, plumbing or domestic appliances. There are preventative measures that landlords can take to limit the chance of their investment being targeted by criminals:
- If the property will only be empty for a short period of time, use of timed lights can deter any opportunist thieves.
- If the property is likely to be empty for a longer period then it’s recommended that windows and doors are boarded up to prevent burglars and squatters gaining entry.
- Keep gardens and outside areas well maintained – an untidy garden is a sure sign of a vacant house.
- Visit regularly to keep an eye on the property and move any mail that may have built up.
Single properties are relatively straightforward to maintain, but as the size of the asset increases, so does the complexities when left unoccupied. At times, larger properties such as a block of flats or commercial office premises, can become vacant for reasons out of a landlord or tenants control.
Following the devastating fire that destroyed Grenfell Tower, a 24-storey residential tower block in North Kensington, the impact has resounded throughout the country. Cladding tests have been performed on similar buildings and at the time of writing (10th July 2017) 181 high-rise buildings from 51 local authorities had failed tests as samples were found to have combustible material. This has led to hundreds of residents being evacuated from their homes in North London after fire inspectors confirmed that five tower blocks were at risk following the Grenfell Tower blaze.
Although the safety of tenants is paramount, empty properties on this scale inevitably result in stress and reduced income for landlords.
How Miles Smith can help you
Many landlords will encounter difficulties when insuring properties which are unoccupied longer than 30 days. Some landlord insurance policies may incur changes after this time leaving the property vulnerable, and the landlord liable for any damages. We provide insurance cover for properties that are vacant meaning that landlords have one less thing to worry about.
Miles Smith has been providing insurance solutions to waste and recycling businesses in the UK for over 25 years. We are market leaders and operate the longest running waste property facility in the UK market. We work closely with industry specialists and risk managers to provide sustainable insurance solutions.
Appointed brokers to the Environmental Services Association (ESA)
Affiliated organisation to the Chartered Institution of Wastes Management (CIWM)
Schemes and facilities
Waste management companies
Material recycling facilities
Consultants and surveyors
Classes of insurance covered
Material damage & business interruption
Plant and machinery
In order for consumers to spend money on leisure activities, their personal financial circumstances have to provide them with disposable income for non-essential expenditure. The increased confidence and disposable income that UK consumers experienced at the beginning of 2016 contributed to 95% of consumers spending money on leisure activities in Q1 of that year, of whom two-thirds spent money drinking in pubs and bars. However, despite the increased demand for leisure activities, the number of nightclubs has almost halved in the last decade.
What are consumers looking for in the leisure and nightlife industry?
20 years ago the nightclub scene was thriving, however between 2005 and 2015 the number of nightclubs almost halved from 3,144 in 2005 to 1,733 in 2015 (Association of Licensed MultipleRetailers (ALMR)). This has been accompanied by a rapid decline in the number of pubs over the last30 years. In 1982 there were 67,800 pubs in the UK, however by 2015 this number had decreased to50,800, which is the lowest number of pubs in the UK for more than half a century. However, UK consumers are still spending their money on nightlife and leisure activities, so where is this money going?
Anna Tolley, AB InBev Legal and Corporate Affairs Director for North Europe says,
“To understand changing consumer tastes brands need to appreciate that the day and night time economy in 2017 has moved far beyond traditional ‘consumption settings’”
Anna commented on the nightlife industry saying,
“We have seen an increase in the number of consumers craving a ‘unique’ experience and wanting to be part of something different. So for us, the challenge is around how we carefully pair our premium products, with relevant and unique experiences that meet our consumers’ needs.”
The demand for a new and different nightlife experience is increasing, and as consumer confidence continues to grow in the UK it is vital that corporations within the nightlife and leisure industries adapt and consider their offering to align with consumer demand.
What are consumers looking for?
The most recent Annual VIBE Beverage Consumer Trend Survey identified that the top types of restaurant and bars visited most frequently within the UK are casual dining chains, local bars and fine dining and independent casual dining establishments. Males tend to frequent local neighbourhood bars, fine dining and casinos whereas women favour casual dining chains, independent establishments and nightclubs.
Clubs and bars are vital to the UK economy, as highlighted by the Forward into the Night report produced by the Night Time Industries Association (NTIA). This states that night-time businesses employ 1.3m people and generate 6% of the UK’s gross domestic product. This demonstrates that there is still high demand for the nightlife and leisure industry within the UK, despite the decline in traditional nightclubs and pubs.
How Miles Smith can help you
It is vital that you understand the changing climate your client is operating in and are able to adapt to their requirements and provide tailored insurance solutions to meet their needs. Miles Smith London Market Broking provides insurance schemes which cater for the evolving and developing nightlife and leisure industries.
An interview with Miles Smith’s Nick Pauley (Divisional director – professional risk) on the impact of the discount rate change on a broker’s professional indemnity cover
How do you think that the change to the Discount Rate exposes commercial retail insurance brokers across the UK?
This change increases the burden on insurance brokers to explain the consequences of the rate decrease to its affected clients and the advice they give to them.
Miles Smith recently published a guide demonstrating how some employers’ liability claim notifications have increased overnight. In the example we gave, the reserve jumped from £7.5m to £14.5m; if the insured was only covered for £10,000,000 under their liability insurance, their business would have been responsible for the shortfall of £4,500,000, rendering most SME businesses bankrupt.
So what does this mean in practice?
Knowing the impact and not relaying it to clients potentially exposes brokers to breaching their duty of care and their own errors and omissions (E&O) insurance could be exposed if they haven’t highlighted to their clients the risk of underinsurance.
If a client’s insurer declines a claim, or declines to offer full indemnity, there is a possibility that the broker will be brought into the dispute and be blamed for the insurance not responding fully. The duty of care on brokers is so onerous and Courts have often found in the policyholder’s favour, despite the best efforts of the broker to look after their client’s best interests. However, brokers should be able to defend themselves if they ensure that contact is made with all clients making them aware of the change and advising them to review their insurance needs with their broker, accordingly. This communication should be properly documented and if the client chooses not to take action upon the advice given by the broker, this should be recorded in writing…if its not in writing, it didn’t happen!
What should brokers do?
It is of utmost importance that brokers alert their client base to the likely exposures to their business if they fail to purchase higher policy limits on policies which could be affected by the change to the Discount Rate.
And what is the minimum PI Limit required for brokers?
The minimum professional indemnity (PI) policy limits for insurance brokers required by the FCA under the IMD rules are modest, starting at the sterling equivalent of EUR 1,120,200 (any one claim) or EUR 1,680,300 if the policy limit is expressed as an aggregate. These limits bear no relation to the size of the claim a broker may face in the event of their negligence or breach of professional duty. For example, it would be naïve of a broker to continue to maintain a PI limit of £2m when they are regularly placing property insurance with sums insured of £50m.
In the past few months Miles Smith’s Professional Risks team have seen evidence of many brokers reviewing their own PI policy limits and purchasing much higher limits. Excess layers are still relatively cheap and brokers face further uncertainty arising from their responsibilities under the, as yet untested, Insurance Act 2015.
How can Miles Smith help?
As PI specialists, the Miles Smith Professional Risks team can review broker’s E&O insurance arrangements to protect their business against the uncertainties of the Discount Rate change and other professional risks they may face.
To access our easy-to-read guide on the Discount Rate changes, please follow the link.
A change to the Discount Rate (often referred to as the Ogden Rate) was introduced by The Lord Chancellor in March 2017. The following infographic summarises how the change affects your clients and their businesses.
As anti-theft devices in vehicles become ever more sophisticated, thieves look to prey on those who leave their keys in their vehicles.
It’s understandable that insurers expect policyholders to take ‘reasonable care’ when both using their vehicles and leaving them unattended. And while the insurance companies’ requirement to keep your asset safe is logical and well documented, there’s a particular exclusion that has been a thorny issue for many years.
If a vehicle or its contents are stolen and the keys were left in the ignition, not all insurers will pay out. And while insurers’ position on petrol forecourt theft is well known, what is not often considered is cover for those types of vehicles which are used to operate tools of the trade, and which require the engine to be running for the ‘tool’ to operate.
Lack of knowledge of industry vehicles and practises means that insurers’ stance on what is defined as ‘reasonable care’ can vary. There are many examples where it may be necessary to leave the keys in the ignition whilst the cab is left unattended. These include skip loaders, which have a hydraulic lifting arm operated from beside the cab rather than in it, and cement mixers needing the keys in the ignition to turn the drum; often these scenarios would be excluded under a standard fleet wording.
The leading case on leaving a vehicle unattended is still Starfire Diamond Rings Ltd v Angel (reported in 1962 in Volume 2 of the Lloyd’s Law Reports at page 217) where a definition of a vehicle being ‘attended’ was determined as:
“there must be someone able to keep it under observation, that is, in a position to observe any attempt to interfere with it, and who is so placed as to have a reasonable prospect of preventing any unauthorised interference with it”.
Lord Denning (in the Court of Appeal)
As such, the key fact for insurers to establish is whether the vehicle has been left ‘unattended’. In subsequent cases this has been deemed as the driver moving so far away from the vehicle that it would be unlikely that they could prevent the theft. However, this test is not always as straightforward to apply to commercial vehicles which are used to operate tools of the trade.
Clearly, the ‘keys in car’ clause is a common but restrictive exclusion. As a result, the Financial Ombudsman says insurers must highlight it when the policy is sold, or ensure it’s clearly stated in any summary provided with the full policy.
How Miles Smith can help you
Miles Smith offers tailored unique solutions to all types of exposures.
Our schemes and facilities are tried and tested, and continue to be market leading products to meet our client’s insurance needs.
Sharon Brown, Miles Smith Insurance Group’s Distribution and Marketing Director discusses the impact mergers and acquisitions (M&A) have on the group’s business and why they are such a crucial part of the company’s strategy.
Miles Smith’s core value is that it is a relationship company; its focus is on delivering the best product, proposition and service to the policyholders, brokers, insurers and affinity organisations with which it works.
What do Miles Smith look for in an M&A?
Miles Smith only does M&A where the objectives of the M&A are aligned to its culture and strategy:
- It brings better propositions to customers and insurers
- It strengthens and augments those relationships
- It improves and expands the skills in the business
But most importantly the culture must fit.
For Miles Smith, fundamentally the M&A must add value to its proposition; it is not used as a way of enhancing power in the chain.
Why do Miles Smith do M&A?
Miles Smith does M&A to support the proposition it delivers to all stakeholders (policyholders, brokers AND insurers), i.e.
- The acquisition brings expertise and product depth
- Miles Smith is able to take that expertise and product depth to a broader market through its diverse distribution channels
- Utilise their combined expertise to enhance efficiency of operation
It’s not just about delivering volume, it’s about working with companies that create mutual benefit for stakeholders in the insurance relationship.
What does that then enable the business to do?
- Grow skills, experience and expertise relatively quickly – coupled with Miles Smith’s own skills and experience in enhancing the market presence of the acquired business
- Provide solutions, for example, an exiting shareholder who wants to know that the skills and experience within his business will be utilised and his customers will continue to receive quality service and product going forward
- Support Miles Smiths’ unique product proposition, either in terms of product base or route to market such that more people (policyholders, brokers and insurers) can benefit from it in the future
What do Miles Smith want to gain from M&A?
The ambition of Miles Smith is not to do M&A for the sake of it but to do the right M&A to enable continued development and augmentation of the business, brand and ultimately the shareholder value. Putting the relationships of the business with its key stakeholders first is paramount.
How do Miles Smith find potential acquisitions?
Miles Smith has a particular strategic acquisition profile that takes certain criteria into consideration, such as:
- Niche expertise
- Ageing shareholders with no succession plan in place, looking to exit
- A business that has outgrown its model and requires the support and scalability of a larger parent
- A strong and experienced workforce that fits its culture and philosophy
- Experienced management team with ambitions and cultural alignments to Miles Smith
- Businesses which can enhance existing distribution channels
- A track record of growth delivery
Identification of strong synergies between the businesses and the relationships of the management and staff is always paramount.
How does Miles Smith identify potential opportunities?
Potential opportunities can fall into several categories, be they individual, team, retail or wholesale brokers and are identified applying Miles Smith’s strategic acquisition profile. Potential opportunities arise from:
- Acquisition software tools
- M&A industry experts
- The CRM knowledge of its brokers
- Commercial market opportunities
- Insurer referrals
Managing the pipeline closely is imperative as the market conditions change frequently, keeping an ear to the ground can save time and energy.
How does Miles Smith ensure success with M&A?
Miles Smith has an acquisition model that allows it to dedicate existing and incremental resource to target and integrate potential M&A. Based on its previous experience, it is able to integrate businesses within a very short period of time. Funding methodology is dependent upon the individual acquisition and can include bringing debt into the business. Financial advisors and an internal project team are integral to integrating the acquisition smoothly into the business.
There are many lessons to learn following each acquisition, however Miles Smith is always mindful of the following:
- Consideration of what success is and how it’s measured using KPIs
- Communication – this may not always be possible during the process and leakage of information is always a risk, managing this can be challenging
- Time – things always take longer than anticipated. If the business hasn’t done any preparation for sale then due diligence tends to take a little longer
Miles Smith CEO, Paul Chainey, says on the subject
“Everyone should leave the party with a balloon! For Miles Smith, M&A is all about adding value to its proposition for all stakeholders and is not to be used as leverage in the chain.”