I saw this interesting snippet on the Lloyd's web-site. I cannot make up my mind whether I think that it will make much in the way of a material difference. What do you think?
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Underwriters are considering what the insurance implications of the full smoking ban in the UK will mean after it comes into effect on 1 July 2007.
Businesses across the country are preparing for the ban by making outdoor provisions for smokers. Under the law, smoking will be banned in “all enclosed spaces”, including pubs, clubs and work spaces.
Health Minister Paul Goggins said the law would save lives, adding: "People do not want to breathe in others' smoke.
Undoubtedly a total ban will benefit the health of the nation, but what about the finances of the businesses it affects?
Ken Watson, business development executive of Marsh risk trading practice, said the ban would have limited consequences for businesses. He said: “In effect, I expect that the ban on smoking will do little to the costs of a club or licensed premises’ insurance cover. The fact that there are people smoking in your club or premises is not a rating issue for underwriters. It may well be argued that as there will not be anyone smoking inside the building it should make the potential for a damaging fire less than it currently is.
“However, under the vast majority of pub and club policies there is a stated expectation that all ashtrays and bins which have been used to collect the residue of cigarettes and cigars are properly emptied and disposed of at the end of each night.”
But John Heaney, Hiscox commercial underwriting manager, said some underwriters could perceive the ban as a way of reducing fire risk. He said: “The main area this will affect is the fire risk caused by smoking,” he says. “For years it has been good practice to allow smoking in designated areas. Now the change could have a significant impact on pubs and clubs which see a lot of fire claims.”
Employers who fail to comply with the regulations could face passive smoking liability claims from employees, Heaney warned. However he added: “Whether or not those claims succeed is something that we will have to wait and see. This could be seen as an emerging risk.”
Smoking facts
• Official figures suggest that as many as 1 in 4 adults smoke
• Anti smoking charity ASH, say that there about 12 million smoking adults in the UK
• Age group 20-24 is most likely to smoke
• The British Medical Association (BMA) say that about 3 million workers are regularly exposed to second hand smoke, and that about 1.3 million are exposed to second hand smoke 75% of the time