Category: Claims handling · Reviewed by Amy Price, Account Executive · Last reviewed 2026-06-11
The “reasonable time” under section 13A(2) of the Insurance Act 2015 is the period within which an insurer must pay sums due — measured by reference to the facts of the case, including the time needed to investigate.
“Reasonable time” is the central temporal concept of the section 13A duty. It is not a fixed period; it is a flexible standard responsive to the facts. A simple property claim of clear cause and quantum has a short reasonable time. A complex coverage-and-quantum case with disputed liability has a longer one. The court’s task is to identify what is reasonable on the facts; the insurer’s task is to position itself within that envelope.
Section 13A(2) provides that what is reasonable will depend on all the relevant circumstances, including the type of insurance, the size and complexity of the claim, compliance with relevant statutory or regulatory rules and guidance, factors outside the insurer’s control, and any other relevant circumstance.
The non-exhaustive list signals that the inquiry is fact-specific. Standardised timetables do not apply; each claim is assessed on its own facts.
The reasonable time begins running once the insurer has the information needed to assess the claim. Quadra Commodities [2023] EWHC 2068 (Comm) confirmed that the clock starts when the insurer has had a reasonable opportunity to investigate and that subsequent inaction by the insurer is what attracts liability.
ICOBS 8 supports the analysis by requiring insurers to handle claims promptly and fairly. The ICOBS regime does not prescribe specific timetables but is influential in shaping what is reasonable.
PRA SS18/16 sets operational resilience expectations including claims-handling timeliness as part of the firm’s overall operational capability.
The reasonable-time analysis is conducted post-hoc, typically by the court when a section 13A damages claim is brought. The court reconstructs the timeline:
For property and motor claims with clear cover and quantum, reasonable time is often weeks rather than months. For complex coverage disputes, six to twelve months may be reasonable.
The complexity of the claim is the principal factor. A £6m business interruption claim involving forensic accountant reports, multi-site complexity and aggregation analysis legitimately takes longer than a £15,000 motor own-damage claim.
The insurer’s conduct during investigation is also relevant. An insurer that resources the investigation properly, communicates regularly with the insured and the broker, and takes decisions promptly when it has the information will be in a stronger position than one that delays, requests marginally relevant information or hesitates.
Operationally, insurers track each claim’s age-and-status against internal targets that approximate the reasonable-time standard. Claims that breach internal aging benchmarks are escalated and may attract handler intervention or technical review.
Section 13A(4) provides a defence where the insurer had reasonable grounds for disputing the claim and acted reasonably in handling it. The defence requires both elements — reasonable grounds and reasonable handling. An insurer with reasonable grounds but poor handling cannot rely on the defence; nor can one with good handling but no reasonable grounds.
“Investigatory period” — the period during which reasonable time is paused or extended for legitimate investigation.
“Disputed period” — the period during which the insurer is reasonably disputing cover; the section 13A(4) defence may apply.
“Interim payment” — partial payment during the reasonable-time window can demonstrate good faith and reduce the damages exposure.
“Excess of reasonable time” — the period after reasonable time has elapsed during which damages accrue.
“Tactical delay” — delay for reasons unconnected to legitimate investigation; attracts damages and may also attract FCA supervisory attention.
A storm-related property claim of £180,000 is reported on 4 February. The insurer acknowledges on 5 February and instructs an adjuster who attends on 7 February. The adjuster’s report is produced on 21 February and recommends payment of £170,000 (with £10,000 disputed on a betterment argument). The insurer requests further documentation on the betterment point on 28 February; the policyholder provides it on 10 March. The insurer pays £170,000 on 24 March and the disputed £10,000 (settled at £6,000) on 18 April.
Section 13A analysis: the reasonable-time framework applied to the £170,000:
Total elapsed time approximately seven weeks, within reasonable time for the claim type and complexity. No damages liability.
For the disputed £10,000 element: section 13A(4) reasonable-grounds defence applies; the betterment argument was reasonable and the insurer’s handling was reasonable. No damages liability for the additional five-week delay.
The insurer’s claim-handling SLA targets 60 days for storm property claims of this size and complexity. Actual handling at 49 days was inside SLA and inside reasonable time.
By Matt Bartlett, Director, on 2026-06-11. Next review: 2026-12-11.
This entry is part of the Apex Insurance Wiki. Last reviewed by Matt Bartlett on 2026-06-11. Apex Insurance Brokers Limited, FCA FRN 724952, Companies House 07014570. Not regulated advice — consult your broker on your specific position.
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