My Lords, Amendment 3 is, with a few slight amendments, the text which the noble and learned Lord, Lord Woolf, put forward in Committee concerning terms not relevant to the actual loss. It is intended to prevent an insurer from relying on a policyholder’s non-compliance with a warranty or other contract term in order to avoid liability for an insurance claim for loss of an entirely different kind.
From the outset, the policy aim behind this amendment has been generally well supported. There were some concerns about the drafting of the clause, which meant that it did not achieve a sufficient consensus of support such that it could be introduced as part of an uncontroversial Bill. The text of this amendment was proposed and consulted on by the Law Commission after the introduction of the Bill as a drafting solution which, it was hoped, would be suitable for this non-controversial parliamentary procedure.
I am very pleased that the written and oral evidence put to the committee, together with the backing of the committee members themselves, has demonstrated a strong body of support for this formulation. As such, the Government consider it suitable to be included in this Bill. It complements the existing Clause 10, which makes changes to an insurer’s remedy for breach of warranty. I beg to move.