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Businesses Must Look To Safety, Says SEIB

Liability insurance becoming more difficult and expensive

Public liability insurance could become difficult to get in coming months - and the situation could pose a threat to riding schools and livery yards

The situation is a result of high awards being made by the courts, coupled with shock waves from the terrorist attack on New York's twin towers. Insurance companies are now viewing liability cover with much more care than ever before and some high-profile companies are even pulling out of the market altogether. Riding Schools, livery yards and other equestrian businesses with bad claims records could find premiums rocketing - or be uninsurable.

"Claims today could result in courts awarding damages running into millions of pounds," says Barry Fehler, managing director of South Essex Insurance Brokers, one of the few companies still able to arrange this type of cover. "It has not been helped by people being encouraged to resort to litigation, but the two situations together have resulted in a quite serious closing down of this market."

In the future, it is likely to be only insurers with a large volume of liability business who will be willing to take on new clients, and even they will be examining renewals more closely than ever before.

Riding schools, and if DEFRA minister Elliot Morley pursues his comments on widening licensing laws, livery yards, would also need public liability insurance to continue trading.

It means that businesses, and these two in particular, will be forced to look more closely at safety practices. "I am not suggesting that it will be impossible to get this cover, but a business which has had claims which reflect on their management could well find premiums rising dramatically, and in extreme cases, becoming uninsurable," said Mr Fehler.

Risk assessment exercises, where a business examines every aspect of its operation, will become increasingly important. Proprietors will need to look at day to day activities, staff routine and building and office layout in an attempt to predict and eliminate hazardous areas - and document the checks, which should be made at least once a year.

Richard Bacon, lecturer in equine business management at Warwickshire College, commented: "Insurance is obviously an area of concern, and again emphasises the need for people in the sector to face up to the professionalism in business matters required today. The industry has a wide range of managerial competence, but sadly, the old adage of horses and water applies to some of those most needing help."

Chris Doran, administration manager of Riding Schools/Approvals at The British Horse Society, stresses the need to show an anticipation for problems. "We can offer advice and help to businesses," she says. "I cannot advise too strongly on the need for an attention to detail, right down to recording any incident in the accident/incident book, which is now compulsory under Health and Safety legislation."

South Essex Insurance Brokers is also able to offer advice. "We will continue to offer public liability cover, but clients will be made aware of the industry climate and encouraged to do everything possible to reduce the possibility of claims," said Mr Fehler


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