Third Parties (Rights against Insurers) Act 2010 – Finally Coming into Force August 2016

The long awaited Third Parties (Rights against Insurers) Act 2010 (‘2010 Act’), which received Royal Assent on 25 March 2015, will come into force on 1 August 2016. 

The 2010 Act repeals and replaces the Third Parties (Rights against Insurers) Act 1930 (‘1930 Act’) save for instances in which the insured incurred liability to a third party and the relevant insolvency proceedings were commenced before 1 August 2016.

The 2010 Act is intended to redress the inadequacies of the 1930 Act and seeks to make it more cost effective and time efficient for a third party claimant to bring a claim directly against the insurer of an insolvent individual or corporate defendant.

The main changes that will be brought about by the 2010 Act are as follows:

1) Multiple Proceedings

Under the 1930 Act, a third party was obliged to “establish” the existence and amount of the insured’s liability before being able to issue proceedings against the insurer.


Under the 2010 Act, a third party will no longer be required to establish the insured’s liability to it first. A third party will be able to bring a substantive claim against the insured alongside an action for an order that the insurer pay any damages awarded.

This will remove the need for multiple sets of proceedings which is likely to save time and reduce legal fees for third party claimants.

2) Information Rights

The 2010 Act improves a third party’s right to information about a relevant insurance policy. If a claimant reasonably believes that the insured has incurred liability to it, it may, by notice in writing, ask for confirmation as to whether a policy that covers the supposed liability is in place. If such a policy exists, the claimant can ask the insured (or any other party reasonably believed to hold any information) to provide details such as who the insurer is and the terms of the policy.

A person who receives a notice requesting such information must, within 28 days beginning with the day of receipt of the notice, provide the third party with all of the information that they are able to provide. If the recipient is unable to provide the required information, but is aware of another party that may be able to provide it, contact details must be provided to the third party.

Whilst this is helpful for third party claimants, it is likely to result in an increased administrative burden on insurers, insured parties and their brokers who may be faced with increasing numbers of requests for information.

Please note that this information is provided for general knowledge only and therefore specific advice should be sought for individual cases.

For further information, please contact Edward Vaughan at