Insurance Law Monthly

It is hard to think that those who discovered the ‘miraculous’ industrial properties of asbestos in the 19th century can have imagined what devastating consequences it could have for those employed to work with it. Still less, one suspects, did the draftsmen of the then-novel employers’ liability policies predict what difficulties those consequences would cause for their wordings. In the law of insurance, asbestos-related disease has created its own set of problems, and it is in this context that the so-called Employers’ Liability Policy ‘Trigger’ Litigation arose. Durham v BAI (Run Off) Ltd [2008] EWHC 2692 (QB), six lead cases heard by Mr Justice Burton over a period of two months, judgment being handed down on 21 November 2008, is discussed by Neil Hext of 4 New Square.

Re Equitas Ltd [2008] EWHC 2960 (Ch) raised a short point on the publicity requirements of Part VII of the Financial Services and Markets Act 2000 in the context of the transfer of insurance business.

The appeal to the Court of Appeal in HLB Kidsons v Lloyd’s Underwriters [2008] EWCA Civ 1206 saw that court, more or less for the first time, analyse the operation of a claims made liability policy under which – as is almost always the case – the assured is entitled to extend coverage by notifying circumstances which may give rise to a claim. As will be seen, although the Court of Appeal by a majority overturned much of the ruling of Mrs Justice Gloster and held that there had been a valid notification of circumstances, two judges constituting the majority – Rix and Toulson LJJ – disagreed on some fundamental issues. Lord Justice Buxton, who dissented on the notification issue, nevertheless agreed with Rix LJ on all other matters.

In Markel Capital Ltd v Gothaer Allgemeine Versicherung AG [2008] EWHC 2517 (Comm) the claimant reinsurers sought summary judgment for negative relief against two reinsureds in respect of the reinsureds’ claim for indemnification for payment under directors’ and officers’ cover. Because the case was concerned with an application for summary judgment, the ultimate question was whether the reinsurers had a reasonable prospect of success in defending the claim, which Mr Justice Andrew Smith thought was the case. Accordingly, the issues raised by the case, relating to a claims cooperation clause, are not analysed in the depth that will be required should the matter come to trial.