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Professional indemnity insurance: exclusions for potential collusive claims
Professional indemnity policies, including directors' and officers' policies, that offer cover on a composite basis to two or more persons, frequently exclude "insured v insured" claims. The purpose of that exclusion is to prevent collusion between the insured persons. There is little authority on the meaning of this exclusion.
Online Published Date:
08 April 2018
Appeared in issue:
Vol 30 No 4 - 01 April 2018
Property insurance: warranties
Sections 10 and 11 of the Insurance Act 2015 have swept away the old law on warranties, suspensory conditions and conditions precedent. Under the new regime, by section 10 a warranty operates only to suspend the risk during the period of breach. If the risk is so suspended, or if the term is not a warranty at all, then the clause still has to pass the test under section 11 and the assured may recover if he can show that the breach was immaterial to the loss.
Online Published Date:
09 April 2018
Appeared in issue:
Vol 30 No 7 - 01 July 2018
Motor vehicle insurance: use of a vehicle
The decision of the Court of Justice of the European Union in Vnuk v Zavarovalnica Triglav dd Case C-162/13 [2015] Lloyd’s Rep IR 142 has proved to be something of a landmark in the interpretation of the Consolidated Motor Insurance Directive, European Parliament and Council Directive 2009/103. It was confirmed in that case that a vehicle has to be insured for use on public or private land at any time when it is being used for transport.
Online Published Date:
09 April 2018
Appeared in issue:
Vol 30 No 5 - 01 May 2018
Subrogation: co-insurance
In Haberdashers’ Aske’s Federation Trust Ltd v Lakehouse Contracts Ltd and Others [2018] EWHC 558 (TCC) Fraser J addressed the vexed question of whether a sub-contractor was entitled to the protection of a Project Insurance policy covering all sub-contractors and was therefore immune from subrogation proceedings.
Online Published Date:
09 April 2018
Appeared in issue:
Vol 30 No 8 - 01 August 2018
Property insurance: the measure of indemnity
The decision of Thomas J in the High Court of New Zealand in Southern Response Earthquake Services Ltd v Shirley Investments Ltd [2017] NZHC 3190 is yet another in a long line of authorities on the measure of indemnity under a property policy.
Online Published Date:
09 April 2018
Appeared in issue:
Vol 30 No 7 - 01 July 2018
Property insurance: subsidence and heave
The short question before Hargrave J in the Supreme Court of Victoria in Guastalegname v Australian Associated Motor Insurers Ltd [2017] VSC 420 was whether a policy exclusion for “soil movement” encompassed the expansion and raising of the level of soil, ie, “heave”.
Online Published Date:
09 April 2018
Appeared in issue:
Vol 30 No 4 - 01 April 2018
Consumer insurance: avoidance for misrepresentation
The Consumer Insurance (Disclosure and Representations) Act 2012 removes the right of an insurer to avoid a consumer insurance policy for misrepresentation unless there has been a deliberate or reckless misstatement by the assured.
Online Published Date:
09 April 2018
Appeared in issue:
Vol 30 No 6 - 01 June 2018
Motor insurance: compatibility of UK and EU law
RoadPeace v Secretary of State for Transport [2017] EWHC 2725 (Admin) is a challenge by way of judicial review to various provisions of the Road Traffic Act 1988, the allegation being that the UK regime is incompatible with the requirements of the EU Consolidated Motor Insurance Directive, European Parliament and Council Directive 2009/103/EC.
Online Published Date:
09 April 2018
Appeared in issue:
Vol 30 No 9 - 01 September 2018
Liability insurance: aggregation clauses
The Court of Appeal in Spire Healthcare Ltd v Royal & Sun Alliance Insurance plc [2018] EWCA Civ 317 has affirmed the first instance decision of HHJ Waksman QC [2017] Lloyd’s Rep IR 118 on the interpretation of a professional indemnity policy. The issue was whether the policy provided for an aggregate limit of liability in respect of a number of similar claims.
Online Published Date:
09 April 2018
Appeared in issue:
Vol 30 No 6 - 01 June 2018
Mutual insurance: liability claims
Mutual insurers, notably P&I Clubs, provide in their rules that there is no entitlement to payment if a member has a claim, Instead, there is a discretion, but that discretion must not be exercised in an arbitrary, capricious or irrational fashion. In Wellington City Council v Local Government Mutual Funds Trustee Ltd [2017] NZHC 2901 Collins J discussed the exercise of such a discretion in the unusual circumstances where the mutual had given up valuable rights under its reinsurance in the absence of knowledge that a member faced a claim.
Online Published Date:
09 April 2018
Appeared in issue:
Vol 30 No 9 - 01 September 2018
Property insurance: betterment
It is settled law that an assured who has insured on an “old for old” replacement sum has to bear the cost of betterment, ie the benefit secured by the assured for receiving a higher standard repaired property than that originally lost.
Online Published Date:
09 April 2018
Appeared in issue:
Vol 30 No 8 - 01 August 2018
Illegality: indemnification for criminal acts
The law of illegality was transformed by the decision of the Supreme Court in Patel v Mirza [2016] 2 Lloyd’s Rep 300. Rigid principles were replaced by a flexibility test. There are no post-Patel insurance cases, but the decision of Lord Tyre in the Court of Session Outer House, in D Geddes (Contractors) Ltd v Neil Johnson Health & Safety Services Ltd [2017] CSOH 42 shows that one particular problem created by the authorities prior to Patel has been removed.
Online Published Date:
09 April 2018
Appeared in issue:
Vol 30 No 5 - 01 May 2018
Product liability insurance: meaning of “product”
The English view of product liability policies, and of exclusions from general liability policies, is that a “product” does not include a house. In Metricon Homes Pty Ltd v Great Lakes Insurance SE [2017] VSC 749 the Victoria Supreme Court has rejected that analysis. The case contains a great deal of learning on other aspects of product liability insurance, including the distinction between defects in the product itself and consequential loss caused by the defective product.
Online Published Date:
09 April 2018
Appeared in issue:
Vol 30 No 11 - 21 November 2018
Motor vehicle insurance: definition of “motor vehicle”
The Road Traffic Act 1988 requires insurance to be in place for the use of a “motor vehicle” on a road or in a public place. The definition of “motor vehicle” in the Act is somewhat different from the definition in the EU Consolidated Motor Insurance Directive 2009.
Online Published Date:
09 April 2018
Appeared in issue:
Vol 30 No 10 - 01 October 2018
Property and business interruption insurance: the measure of indemnity
The decision of HHJ Davis in Contact (Print and Packaging) Ltd v Travelers Insurance Co Ltd [2018] EWHC 83 (TCC); [2018] Lloyd's Rep IR 295 discusses a series of important issues on causation and the measure of indemnity for losses of business equipment and for business interruption.
Online Published Date:
09 April 2018
Appeared in issue:
Vol 30 No 7 - 01 July 2018
Professional indemnity insurance: scope of management consultancy
Two issues were live before the Victoria Court of Appeal in Blakeley v CGU Insurance Ltd [2017] VSCA 378. First, what was the scope of a professional indemnity policy taken out by a management consultancy? Secondly, were the insurers entitled to avoid liability by reason of the assured’s failure to disclose that its activities included acting as director of a client company?
Online Published Date:
09 April 2018
Appeared in issue:
Vol 30 No 12 - 04 December 2018
Liability insurance: costs and mitigation
The lengthy decision of Moulder J in Euro Pools plc v Royal and Sun Alliance Insurance plc [2018] EWHC 46 (Comm) discusses a series of important points arising under a liability policy. The initial issue was the much-debated question of whether a notification of circumstances under a claims made policy encompasses matters later coming to light, but there were also important questions relating to the recovery of mitigation costs and also costs incurred by the assured in pursuing a third party for indemnity or contribution.
Online Published Date:
09 April 2018
Appeared in issue:
Vol 30 No 10 - 01 October 2018
Motor insurance: the meaning of “use”
The Road Traffic Act 1988, implementing EU law, requires insurance to be in place in respect of liability caused by or arising out of the “use” of a motor vehicle. Recent English cases have given “use” an expansive meaning. The Court of Justice of the European Communities in Rodrigues de Andrade and Another v Salvador and Others Case C-514/16 appears to have adopted a narrower approach, although it may be that the judgment can be confined to the specific question of a vehicle being used not for transportation but rather as a source of power for electrical equipment.
Online Published Date:
09 April 2018
Appeared in issue:
Vol 30 No 4 - 01 April 2018
Professional indemnity insurance: excess layers
Liberty Mutual Insurance Co v Kellogg Brown and Root Pty Ltd [2017] NSWSC 1519, a decision of Stevenson J in the New South Wales Supreme Court, concerned the relationship between a professional indemnity policy obtained by the defendants and an excess layer long-term project policy to which the defendants were named assureds.
Online Published Date:
09 April 2018
Appeared in issue:
Vol 30 No 9 - 01 September 2018
Professional indemnity insurance: the Insolvency Exclusion
In Crowden and Another v QBE Insurance (Europe) Ltd [2017] EWHC 2597 (Comm) Peter MacDonald Eggers QC, sitting as a Deputy Judge of the High Court, undertook a detailed analysis of the Insolvency Exclusion commonly found in professional indemnity policies issued to financial advisers. The analysis raised important questions of construction and causation.
Online Published Date:
09 April 2018
Appeared in issue:
Vol 30 No 8 - 01 August 2018
Professional indemnity insurance: liability for defence costs
The substantive dispute in Oldham v QBE Insurance (Europe) Ltd [2017] EWHC 3045 (Comm) concerned the effect on the payment of defence costs of the insurers raising, and ultimately succeeding in establishing, a coverage claim.
Online Published Date:
09 April 2018
Appeared in issue:
Vol 30 No 11 - 21 November 2018
Liability insurance: calculation of deductible
The New South Wales Court of Appeal in Commonwealth Steel Co Ltd v BHP Billiton
Marine & General Insurance Ltd [2018]
NSWCA 242 has upheld the first instance decision of Hammerschlag J in his
interpretation of a deductible clause in an employers’ liability policy. The question was whether an indexing
provision applied to the sum insured or to the deductible.
Online Published Date:
09 April 2018
Appeared in issue:
Vol 30 No 8 - 01 August 2018
Liability insurance: calculation of deductible
The New South Wales Court of Appeal in Commonwealth Steel Co Ltd v BHP Billiton
Marine & General Insurance Ltd [2018]
NSWCA 242 has upheld the first instance decision of Hammerschlag J in his
interpretation of a deductible clause in an employers’ liability policy. The question was whether an indexing
provision applied to the sum insured or to the deductible.
Online Published Date:
09 April 2018
Appeared in issue:
Vol 30 No 12 - 04 December 2018
Marine insurance: accidental damage and causation
In Sheehan v Lloyd’s Names Munich Re Syndicate Ltd [2017] FCA 1340 the assured under a marine policy suffered total loss of an engine after the oil pressure had dropped but the assured failed to respond to an alarm. The questions were whether the loss was accidental and, if so, whether it was excluded from insurance cover by reason of a defect in design.
Online Published Date:
09 April 2018
Appeared in issue:
Vol 30 No 10 - 01 October 2018
Property insurance: defects in design and interpretation issues
The judgment of Stevenson J in the New South Wales Supreme Court in Mobis Parts Australia Pty Ltd v XL Insurance Company SE (No 7) [2017] NSWSC 1321 runs to an outrageous 1,146 paragraphs. The second half of the judgment was obiter, and much of its first half was an assessment of facts.
Online Published Date:
09 April 2018
Appeared in issue:
Vol 30 No 7 - 01 July 2018
After the event insurance: security for costs
The court has power under CPR 25.13 to order aclaimant to provide security for the defendants costs when the claimant isinsolvent and unlikely to be able to meet the defendants costs in the eventthat the claim fails.
Online Published Date:
09 April 2018
Appeared in issue:
Vol 30 No 12 - 04 December 2018
Motor vehicle insurance: the right to avoid a motor policy
The decision of the CJEU in Fidelidade-Companhia de Seguros SA v Caisse Suisse de Compensation and Others Case C-287/16 is likely to be a major shock to the UK motor insurance industry. It demonstrates that the Road Traffic Act 1988 is out of line with EU law as embodied in the Consolidated Motor Insurance Directive 2009 in significant respects.
Online Published Date:
23 April 2018
Appeared in issue:
Vol 30 No 4 - 01 April 2018
Marine insurance: cover for liability
In Cruise and Maritime Services International Ltd v Navigators Underwriting Agency Ltd (The Marco Polo) [2017] EWHC 843 (Comm) Knowles J rejected a claim to an indemnity against alleged liabilities incurred to passengers on board a cruise ship following an outbreak of norovirus. The decision is discussed by Ben Smiley of 4 New Square.
Online Published Date:
23 April 2018
Appeared in issue:
Vol 30 No 4 - 01 April 2018