Waiver of breach of condition precedent

The decision of the Court of Appeal in Kosmar Villa Holidays plc v Trustees of Syndicate 1243 [2008] EWCA Civ 147 will be welcomed by insurers. The Court of Appeal has in effect reduced the risk of insurers being precluded from relying upon a defence to a claim simply because they have taken some steps to make further inquiries into the circumstances. In legal terms, it has been decided that the principle of waiver by affirmation has no application in these circumstances and that the protection for the assured is to be found in the narrower doctrine of waiver by estoppel. The decision of Mr Justice Gross, [2008] Lloyd’s Rep IR 43, discussed in the September 2007 issue of Insurance Law Monthly, has been reversed.