Scope of authority

In the October 2008 issue of Insurance Law Monthly there was discussion of a decision of Mr Justice Beatson on the question of whether an underwriting agent appointed to accept risks on behalf of insurers had also been given the authority to conduct the insurers’ run-off. Beatson J, [2008] EWHC 843 (Comm), ruled that on the proper construction of the documents no authority had been conferred. That ruling has been upheld by the Court of Appeal: Temple Legal Protection Ltd v QBE Insurance (Europe) Ltd [2009] EWCA Civ 453.

Temple: the facts

The case concerned ‘after-the-event’ (ATE), insurance, which has proved to be both problematic and loss-making for the insurers involved in writing it. As is well known, this type of cover protects a potential claimant in legal proceedings (generally in a personal injury claim) from the risk that the case will be lost and the claimant will face both a cost order and the prospect of bearing his own legal costs. This type of policy became potentially viable following the implementation of the Access to Justice Act 1999, which permits the cost of an ATE premium to be recovered by way of costs, so that in the event of a successful claim the premium is paid by the defendant by way of costs.