Liability insurance: defence costs

In Newcastle Resources Pty Ltd v Certain Underwriters at Lloyd's [2022] NSWSC 1485 Stevenson J addressed some important issues on the construction of a defence costs clause which provided cover for insured claims only. The key question was whether the claims were insured, but that gave rise in turn to questions of allocation of defence costs and advance payment where the amount of defence costs was tied to the ultimate liability of the insurers for the claims against the assured.

Newcastle Resources : the facts