UK Law and Practice Contributed by: Daniel Robin and Chloe Franklin, SDV Fenchurch
9. Legislative and Regulatory Key Trends 9.1 Regulatory Focus Areas and Supervisory Trends Regulatory focus remains centred on fair treatment of customers, claims handling, consumer protection, operational resilience, cyber resilience, ESG, sanc- tions compliance and product governance. These priorities influence insurer behaviour by increas- ing scrutiny of claims communications, declinature decisions, delay, complaints handling and policy transparency. The contractual wording remains cen- tral, but regulatory expectations can provide important context in claims handling disputes. 9.2 Forthcoming Reforms and Market Impact The most significant developments are likely to come through regulatory scrutiny, market drafting and devel- oping case law rather than a single immediate legisla- tive reform specific to insurance litigation. Insurers are expected to continue refining wordings in response to cyber, AI, sanctions, climate, build- ing safety, operational resilience and systemic risks. Policyholders should review exclusions, notification, aggregation, sub-limits and sanctions provisions before renewal rather than after loss.
Coverage disputes commonly concern breach response costs, regulatory investigations, fines or penalties, notification, prior-known incidents, aggre- gation and the distinction between first-party and
third-party losses. 8.4 Data Centres
Data centres create property, business interruption, cyber, technology E&O (experiences and outcomes), energy and liability exposures. Key risks include pow- er failure, cooling failure, fire suppression issues, grid dependency, service interruption and cyber-attack. Coverage disputes are likely to focus on whether there is physical damage, how business interruption is calculated, whether service interruption extensions apply and how losses affecting multiple customers are aggregated. 8.5 Social Media Risk Social media risk remains emerging rather than a mature area of English insurance litigation. Potential exposures include defamation, privacy, harassment, safeguarding, advertising liability, employment claims and regulatory investigation. Insurers are likely to respond through tighter under- writing, clearer exclusions, sub-limits and special- ist media liability products. Caution is appropriate because there is limited English coverage authority in this specific area. 8.6 Next Generation Nuclear Next-generation nuclear technologies create special- ist risks involving construction, design, operational safety, environmental liability, cyber security, terror- ism, supply chain failure and long-tail exposure. The market response is likely to involve specialist underwriting, bespoke exclusions, significant limits and careful interaction with statutory nuclear liability regimes. Mainstream policies often contain nuclear exclusions, so bespoke placement will be critical.
258 I NSURANCE L I T IGATI O N 2026
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