Topic: Insurance

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Covid-19 business interruption Australian judgment mostly favours insurers

In this, second, Australian test case for business interruption claims relating to Covid-19 the court said that “[A] policy of insurance is assumed to be an agreement which the parties intend to produce a … businesslike interpretation … …a construction that avoids capricious, unreasonable, inconvenient or unjust consequences, is to be preferred where the words … Continue reading

Cyber risks again

We have been mentioning for some time the pandemic-like risks associated with cyber events.  According to a recent Airmic survey cyber rates have risen by as much as 400% for some insureds.  Cyber risks are therefore said to be the most likely new risks to be financed by captives. If a systemic cyber event should … Continue reading

‘Strategic response costs’ v ‘ex gratia’

A recent US case referred to an interim payment to injured third parties as ‘strategic response costs’ covered under the policy.  That is a neat phrase to use instead of an ex gratia payment. ‘Ex gratia’ is always controversial because it implies a payment without a lawful obligation.  Ex gratia payments are often made for … Continue reading

Litigation funding is not insurance

In the High Court Steinhoff judgment, it was argued that the litigation funding  agreement between the class representative and the funder was a contract of insurance in terms of which the funder provides indemnity insurance to the class representative in consideration for the funder being paid a premium, being a percentage of the ultimate reward. … Continue reading

Insured loss to value of damaged and repaired vehicles

In the US state of Georgia, the formula applied with court backing since 2001 for determining how much a car’s value diminishes after a wreck and repair is “the difference between pre-loss value and post-repair value”.  Attorneys for two plaintiffs brought a class action alleging that the insurer was underestimating the value of repaired cars … Continue reading

Exploding vape excluded from policy by ‘products completed’ exclusion

An electronic cigarette store failed in its claim for an indemnity from its insurer for a vape battery that exploded in a customer’s pocket away from its premises. The policy excluded an event “occurring on any premises other than the designated premises shown in the schedule”. The products-completed exclusion clearly precluded coverage for bodily injury … Continue reading

Extended business cover confined to physical not financial loss by government Covid-19 action (Aus)

In this August 2021 judgment, the Federal Court of Australia in Star Entertainment Group Limited v Chubb Insurance Australia Limited [2021] FCA 907 had to deal with the interpretation of an insurance policy of the insureds who owned and operated various casinos and associated businesses.  The insureds allege that the government’s directions in connection with … Continue reading

Insurance policies and time bar clauses

The Mpumalanga High Court in this May 2021 judgment upheld the insurer’s reliance on the time bar clause in the policy.  (H Qhibi v MiWay Insurance Ltd (634/2017) [2021] ZAMPMBHC 12) The insured’s claim could not be entertained because it had been brought well after the expiration of the time bar period. It was common … Continue reading

Illegal drug held to be excluded contaminant from insurance policy (US)

A US court found that liquid and solid forms of the illegal drug methamphetamine (a highly addictive stimulant known as meth and by other names) was an excluded “contaminant” for the purposes of a house owner’s insurance policy. The insured’s grandson resided with the insured. The police executing a search warrant discovered liquid and solid … Continue reading

Claim denied for professional services exclusion and interpretation rules (US)

While performing services on a construction site owned by a Port Authority, an employee of a contractor slipped and fell on wet soil and rocks because of unsafe working conditions and sued for damages.  The construction management firm, Techno, was insured under a comprehensive general liability policy. When the port authority was sued by the … Continue reading

Misrepresentation inducing a contract is not a breach excluded by the contractual exclusion clause in a policy (US)

A US court found that the exclusion in an insurance policy against losses arising out of or involving a breach of contract or agreement did not exclude a claim resulting from a misrepresentation that induced the contract. The insurer was excused from paying the amount of an arbitration award arising from a business dispute which … Continue reading

Interpreting the wording of a subscription judgement

In a July 2021 judgment the Supreme Court of Appeal in Capitec Bank Holdings Limited and Another v Coral Lagoon Investments 194 (Pty) Ltd and Others (470/2020) [2021] ZASCA 99 considered the question of how to interpret the wording of a subscription agreement in dispute which governed the basis on which a sale of shares … Continue reading

A pension fund cannot challenge the Pension Fund Adjudicator’s section 37C decision

A pension fund failed in its application for reconsideration of the Pension Fund Adjudicator’s (PFA) decision to refer the matter back to the fund for reconsideration because, according to the Financial Services Tribunal the fund is not a ‘person aggrieved’ as required by section 230 of the Financial Sector Regulation Act of 2017. The fund … Continue reading

Liability for omission

Authors: James Donald and Kristen de Wet In February 2020, the Johannesburg High Court held that the failure by a security company to warn its clients that criminals were impersonating its employees to uplift cash, constitutes an omission of crucial information which provides grounds for an action for damages in delict.  The plaintiff’s claim arose … Continue reading

Terminal illness claim rejected for lack of proof of life expectancy (AUS)

The Australian Financial Complaints Authority (AFCA) rejected a claim for a terminal illness benefit because there was no evidence that the complainant, although seriously ill, had a life expectancy of less than 12 months.  The policy only covered death and terminal illness.  There was no cover for disability or serious illness.  A terminal illness was … Continue reading

Indemnity clauses and the Consumer Protection Act

Indemnity clauses and the Consumer Protection Act In a recent Eastern Cape High Court judgment which you can read about here, the claimant fell into an unfenced pool at the game reserve and injured herself.  The court found in the evidence that the claimant’s conduct was the sole cause of her stepping into the pool and … Continue reading