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During November 2007 a new judgement was handed down in the District Court of Jerusalem which may significantly influence the exposure of insurers and reinsurers under Third Party / Public Liability policies.

According to the Israeli Law, when a claim is filed against a tortfeasor (who is not the employer) by an employee who was  injured while engaged at  work in the tortfeasor's premises, the tortfeasor will be required to pay for the damage sustained, less the payment received by plaintiff from the National Insurance Institute (NII).

The franchising phenomenon started in the United States and Europe; however it is not geographically limited thereto and is now a growing part of Israel's economy and in recent years has become a significant part of the market. Over two hundred and fifty franchised small-medium businesses are operating in Israel, in thirty seven different areas of business[1]. The most dominant franchise businesses in Israel are in the fields of: Beverage & Alcohol, Fast Food, Retail Food Industry, Real Estate, Life style, Cosmetics & Health, Pets, Clothing and Accessories. The fact that more and more large corporations revert to franchising for promoting and expanding their operations has indeed influenced the entire market, however franchising is no longer in the hold of large corporations. Small medium sized businesses also use this structure to expand their operations with only a small number of branches. At the same time, one might find corporations such as: "McDonald's", "Domino's Pizza" (Fast Food), "Zara", "Mango" (fashion & clothing), "Remax" (Real Estate), "Toys-R-Us" (Children) - with dozens of branches all over Israel - all using the franchise implementation.   

Introduction

The Class Action procedure was introduced into the Israeli legal system in 1988, when the legislature amended the Securities Law-1978 by enabling securities holders to file class actions.

In 1999, when the new Israeli Companies Law - 1999 was enacted, the provisions of the law concerning Securities Class Actions were incorporated into the Companies Law.

On 1^st March 2006 a new Class Action Law was enacted. The new law handled all matters in which class actions may be filed including securities, and set principles and requirements which apply thereto.

Despite the time which has elapsed since he Securities Class Action procedure was introduced into the Israeli Law, only recently, for the first time, in C.A. 345/03 Dan Reichart v. Moshe Shemesh and Others the Supreme Court handed down a judgement in which it imposed liability on a class action defendant.

Insurers are often faced with cases in which part of the fault for the loss or damage lies with the assured or someone on its behalf, nevertheless, they are obliged to pay insurance benefits regardless of the assured's acts.

In these cases, during the past few years, the Israeli courts have begun to adopt the contributory fault doctrine also in insurance cases.