Insurance, Herbert Smith Freehills LLP updates

United Kingdom

Contributed by Herbert Smith Freehills LLP
Another non-party costs order against a liability insurer
  • United Kingdom
  • 02 April 2019

The High Court recently awarded a non-party costs order against a law firm's professional indemnity insurer under Section 51 of the Senior Courts Act in circumstances where the insurer had effectively relinquished control of the litigation's defence. This decision clarifies that the court's discretion under Section 51 is broad and that an insurer need not exert any active control over an insured's conduct of the proceedings in order to be the subject of an adverse costs order.

Brokers' negligence – guidance on scope of duty and causation
  • United Kingdom
  • 20 November 2018

The High Court recently considered a negligence claim against an insurance broker which had arisen out of a fire at a waste recycling facility. In its decision, the court provided a useful recap on brokers' duties – in particular, their duty to advise clients on their pre-inception duties of disclosure. Notably, the judge considered how causation should be analysed in brokers' negligence cases where the insured has not pursued the claim against its insurer to settlement, judgment or award.

Broker not in breach of duty to advise in failing to provide oral advice in relation to duty to disclose
  • United Kingdom
  • 14 August 2018

In holding that a broker was not in breach of duty by failing to give oral advice in relation to the disclosure of criminal convictions, the High Court has provided a useful reminder of the extent of a broker's duty to advise in relation to disclosure. The court also held that a lack of expert evidence materially limited, but did not exclude, the possibility of a finding that the broker had breached its duty to act with reasonable care and skill.

PRA and FCA clarify impact of Brexit transition for insurance sector
  • United Kingdom
  • 24 April 2018

Recent announcements made by the Prudential Regulation Authority and the Financial Conduct Authority have clarified their approach to Brexit following the European Council's agreement to a transition period for the United Kingdom's withdrawal from the European Union. Insurers, insurance intermediaries and other financial services firms have been encouraged to assume that they will continue to benefit from passporting rights until December 2020. While this is welcome, firms cannot be complacent.

Insurance arbitrator reinstated on basis that he or she qualifies for appointment under arbitration clause
  • United Kingdom
  • 03 April 2018

The English Court of Appeal has reversed the High Court's decision on whether a party-appointed arbitrator met the contractual requirements as to requisite experience. The English Court of Appeal held that that an English queen's counsel with experience of insurance and reinsurance law was sufficient to comply with a contractual clause requiring arbitrators to have "experience of insurance and reinsurance". The decision highlights once again the importance of drafting arbitration clauses clearly.


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