The Marine Insurance Act needs to be reviewed to keep pace with changes in the UK, according to the Insurance Council of Australia (ICA). It says the industry risks losing its competitiveness.

Australia’s marine insurance laws have closely followed the UK’s since 1909, but this changed last August when the British Government replaced the Marine Insurance Act 1906 with the Insurance Act, marking the biggest shake-up in the UK’s commercial insurance contract law for more than a century.

Key changes to UK marine law centred on utmost good faith, disclosure, remedies for breach of contract and warranties.

The country now adopts a more “pro-insured” approach, such as around misrepresentation and non-disclosure.

“[ICA] is concerned the Marine Insurance Act now retains provisions that have been discarded in the UK, and that Australian marine insurance law will become obsolete in respect of the changes to the UK [Act],” CEO Rob Whelan said.

“Consequently, Australian marine insurance may, over time, become less attractive and the international competitiveness of Australian marine insurers may diminish.

“In that case, marine insurance contracts for Australian risks would likely be increasingly issued by Australia’s global competitors.

“In this respect, we believe the Marine Insurance Act is in need of reform to ensure it remains in step with global expectations of marine law.”