With the UK exploring a potential opt-out consumer class actions regime, businesses and insurers should be alert to a shifting litigation landscape
In a move that will potentially open businesses and insurers to greater risk of expensive class actions, the government has asked the Law Commission to assess whether consumer law enforcement could be strengthened through the introduction of a consumer class actions regime.
The Law Commission has invited stakeholders to complete an initial scoping questionnaire by 30 October 2026, seeking insights on the risks and benefits of an opt-out consumer class actions regime. The project is likely to start in Autumn 2026. It will look at improving consumer access to redress in court and damages distribution and promoting the efficient conduct of litigation at proportionate cost.
Of key concern for businesses and insurers will be the balance of maintaining public confidence in products and services, with protections against unmeritorious and costly litigation.
This is the latest step suggesting that the government is keen to reinforce the UK’s position as a global leader in dispute resolution. Funding reforms are under review following the Civil Justice Council’s recommendation in June 2025 of a legislative reversal of PACCAR and the introduction of a statutory framework for regulating funders. It is anticipated that this may lead to increased consumer confidence in class action litigation. It will also ensure that the UK is aligning itself with EU member states, who have implemented the EU Representative Actions Directive.
With these developments on the horizon, insurers and businesses should be prepared to identify risks and take early action to implement strategies to defend or respond to such actions. The consultation is looking at consumer class actions generally but will be of particular interest to those insurers and businesses who deal with claims for defective products.
Our experience in handling large scale group litigation demonstrates that early legal input, effective cooperation and management is key to dealing with the complex and variable issues arising from such claims.
To discuss how your business can prepare for potential class action exposure, please get in touch with our commercial litigation solicitors or our insurance solicitors.
