The Australian marine insurance industry will struggle to compete in the global marketplace unless legislation is reformed to bring it in line with the UK, says the Maritime Law Association of Australia and New Zealand (MLAANZ).

It says fundamental amendments to the UK Marine Insurance Act will take effect in August.

The changes – in the areas of utmost good faith, disclosure, remedies for breach of contract and warranties – will make the UK industry “more consumer-friendly”, and could lead to clients favouring it over Australia.

In a statement published last month, MLAANZ recommends reform of the Commonwealth Marine Insurance Act 1909 to restore parity.

“[Australia] will be in the invidious position of retaining provisions over a century old which have now been discarded in ‘mother’ legislation in the UK,” the association said.

“As the [UK] adopts a more pro-insured approach it would seem probable that this will place the Australian marine insurance market at a competitive disadvantage and at real risk of losing business.”

Former MLAANZ president and Colin Biggers & Paisley partner Stuart Hetherington told insuranceNEWS.com.au it is time for the marine insurance industry to decide what action to take.

“Given the UK has changed its legislation it is appropriate for us to consider whether we want to be behind the eight ball with aged legislation,” he said.

“Is it time to change and, if so, what changes should we make? It is not our role to tell industry what will happen.

“These are recommendations and we are seeking feedback. This is very much an exploratory expedition at the moment.”

The Insurance Council of Australia (ICA) told insuranceNEWS.com.au its Marine Practice Committee is aware of UK developments, and the council “does not have any views on the issue at this time”.

A consultation event, held jointly by MLAANZ and the Melbourne Marine Insurance Forum, will take place from 11.30am on June 21 at the offices of Colin Biggers & Paisley in William Street, Melbourne.

Email here to confirm attendance.