Coverholders

The simple question in Gammie v Abbey Legal Protection, Sheriff Court, Banff, 14 December 2011, was whether an underwriting agent (referred to in the policy as ‘coverholder’) faced personal liability under a Certificate of Insurance issued on behalf of insurers. Unsurprisingly, the court answered that question in the negative.

Gammie: the facts

Mr Gammie was a member of the Small Business Federation. The SBF had obtained insurance referred to as ‘Federation of Small Businesses Legal Protection Insurance’. This was in the form of a Certificate. The insuring clause stated that the policy would ‘indemnify the Insured at the request of the Policyholder Legal Expenses, Jury Service Allowance and Awards of Compensation as specified in this Certificate and its Schedule in connection with the business activity of the Insured’. The policyholder was the SBF and the insured was ‘any full, joint, retired or associate member’ of the SBF. The insurer was defined as Brit, and the coverholder was Abbey Legal Protection through whom Brit had underwritten the policy.