Topic: Insurance

What’s on the horizon for the insurance industry in 2019?

By Natasha Naidoo and Patrick Bracher (ZA) on May 7, 2019 Posted in Insurance

Our lawyers across ten jurisdictions have created a guide detailing the top legal concerns for insurers from various regions. Some developments are concerns only in a specific market while other topics appear to be common across several jurisdictions. Increasing focus on personal accountability, greater oversight of distribution chains and the protection of customer interests and … Continue reading

Difference between advice and information provided by a professional (for example a broker) – English law

By Patrick Bracher (ZA) on April 23, 2019 Posted in Insurance

English law relating to professional negligence draws an interesting distinction between whether the professional person is giving information or giving advice. This is not specifically part of South African law but it is relevant when considering liability, for instance, of brokers under the FAIS Act. The difference is between providing information for the purpose of … Continue reading

Use of a vehicle includes a passenger opening a car door

By Patrick Bracher (ZA) on April 8, 2019 Posted in Insurance

Extraordinarily, a case involving a passenger opening a car door and scratching a neighbouring vehicle in a supermarket carpark led to a decision before the Court of Justice of the European Union. Europe’s highest court found that this is ‘use of vehicles’ for the purposes of motor vehicle insurance. The event happened in Latvia where … Continue reading

Contractual claim not covered under liability policy (US)

By Patrick Bracher (ZA) on April 4, 2019 Posted in Insurance

Where the purchaser of an oil refinery sued the seller for breach of contract for $25 million damages resulting from a fire caused by various acts and omissions of the seller prior to the sale, the claim was not covered under the seller’s commercial general liability policy. The claim was not based on property damage but … Continue reading

Insurers’ role in losses caused by malfunctioning technology

By Patrick Bracher (ZA) on March 25, 2019 Posted in Insurance

One of the major issues facing the law in an age of autonomous technology is the question of who is liable for damage caused by a machine or artificial intelligence either by physical injury or the failure of a contract. Insurers will have a major role to play. If a machine such as a driverless … Continue reading

Fraud as a defence to payment under a guarantee

By Patrick Bracher (ZA) on March 25, 2019 Posted in Insurance

The guarantor in Raubex Construction (Pty) Ltd v Bryte Insurance Company alleged that payment under a guarantee was not due because of fraud on the part of the beneficiary. A mere error, misunderstanding or oversight, however unreasonable, does not amount to fraud and is insufficient to show that the contentions of the beneficiary are deliberately … Continue reading

Insurance regulation in 20 Asia Pacific countries

By Patrick Bracher (ZA) on February 27, 2019 Posted in Insurance

In January 2019, Norton Rose Fulbright published ‘Ten things to know’ about insurance regulation in 20 Asia Pacific countries. The guide is hosted on our free subscription premium content site, the Institute, as an interactive map featuring the 20 jurisdictions. It covers the following countries for those interested in investing or doing business with insurers … Continue reading

CyRiM warns of up to $193 billion cyber risk – Insurers beware!

By Patrick Bracher (ZA) on February 6, 2019 Posted in Insurance

The Cyber Risk Management (CyRiM) Report 2019 shows that the economic damage to the world from a concerted global cyber-attack propagated by malicious email could range between $85 billion (least severe) to $193 billion (most severe). Retail at least could suffer the highest total economic loss globally ($15 billion), followed by healthcare ($10 billion) and manufacturing ($9 billion). It … Continue reading

Power station damaged by shocked squirrel is excluded

By Patrick Bracher (ZA) on February 6, 2019 Posted in Insurance

Where a squirrel found its way onto a power station’s electrical transformer triggering an electrical arc that killed the squirrel and caused damage to the municipality’s property of $213 524, the court denied the municipality all-risks insurance cover because of an exclusion for ‘loss caused by arcing or by electrical currents other than lightning’. The court … Continue reading

Personalised medicine: Implications for the insurance industry and for consumers

By Natasha Naidoo on January 22, 2019 Posted in Insurance

Personalised medicine is set to revolutionise the manner in which patients are diagnosed and treated. It involves genetic testing and a consideration of an individual’s health risk factors and genetic information and tailoring medical treatment accordingly. Such testing could lead to quicker diagnosis and treatment, but it does not come cheaply. It is unclear whether … Continue reading

The effect of legalisation of cannabis on the insurance industry

By Natasha Naidoo on January 21, 2019 Posted in Insurance

The legalization of private cultivation, possession and the use of cannabis in South Africa has had the effect of changing the law which will undoubtedly require transformation in the insurance industry. The Constitutional Court in Minister of Justice and Constitutional Development and Others v Prince (and others) has given Parliament 24 months to amend current … Continue reading

Consider your verdict: Does motor insurer pay for fire caused while immobilised vehicle being repaired?

By Patrick Bracher (ZA) on December 15, 2018 Posted in Insurance

Here is a nice exercise for you. The UK Supreme Court has heard argument and will soon be giving judgment on the question whether a UK motor policy extends to liability for damage to the property of third parties because of fire caused by repair work to the car when it is immobilised. A mechanic … Continue reading

Bad subcontractor work not an ‘accident’ – Ohio USA

By Patrick Bracher (ZA) on December 7, 2018 Posted in Insurance

Ohio’s high court has held that damage from a subcontractor’s faulty work is not fortuitous in the context of a commercial general liability policy which covered an ‘occurrence’ meaning an ‘accident, including continuous or repeated exposure to substantially the same general harmful conditions’ causing property damage including physical injury to or destruction of tangible property. … Continue reading

Cyber breach claim fails under GLP because information not ‘published’ (US)

By Patrick Bracher (ZA) on December 2, 2018 Posted in Insurance

A Florida court held that the insurer had no duty to defend a hotel operator’s information technology subsidiary against allegations that it was responsible for a hacking incident that exposed hotel customers’ credit card data because, under the general liability policy, there was no ‘making known to any person or organisation covered material that violates … Continue reading

Definition of ‘explosion’ cover in breakdown policy excludes liability

By Patrick Bracher (ZA) on December 2, 2018 Posted in Insurance

A refining company claimed under its equipment breakdown insurance policy following an explosion that occurred when a segment of a pipe in a charge heater designed to refine the petroleum product naphtha burst. A 600 degree naphtha mixture was running through the pipe at more than 14 000 pounds per hour and, when the charge heater … Continue reading

Enforceability of the sanctions exception in policies (UK)

By Patrick Bracher (ZA) on November 25, 2018 Posted in Insurance

An awaited decision on the enforceability of the sanctions provision in policies of insurance heard in the UK courts has turned out to be of not much general assistance. The English High Court found that, although an insurer is not liable to pay a claim where the payment would be prohibited under EU or US … Continue reading

Bitcoin held to be property not money for insurance policy (US)

By Patrick Bracher (ZA) on November 19, 2018 Posted in Insurance

A court in Ohio found that bitcoin is covered ‘property’ under a homeowner’s policy and not ‘money’ and therefore the claim for lost bitcoin was not limited by the money sublimit. The decision was based partly on a recent Internal Revenue Service document that categorised virtual currency such as bitcoin as property for federal tax … Continue reading

PI policy cannot be ceded to third party

By Patrick Bracher (ZA) on November 12, 2018 Posted in Insurance

The professional indemnity policy issued by the Attorneys Insurance Indemnity Fund is incapable of cession to a third party. A purported cession to the client of a law firm who had lost misappropriated trust funds was declared invalid by the Supreme Court of Appeal. Contracts can be ceded to third parties if there is no … Continue reading

Insurer entitled to rely on third party expert’s conclusions (US)

By Patrick Bracher (ZA) on November 4, 2018 Posted in Insurance

A Delaware court held that a property insurer did not breach its policy issued to a farm when it refused to cover the collapse of a chicken coop during a blizzard because it justifiably relied on expert reports indicating that the destruction was caused by snow and faulty construction which were exclusions under the policy. … Continue reading

Defiance of law: the collateral challenge defence by Namibian insurers

By Ian Petherbridge on October 16, 2018 Posted in Insurance

Under the correct set of circumstances a party may treat an administrative act as void and await developments, which must not be ‘equated with contumacious disregard for the law by anarchists and legal delinquents’, according to a judgment of the Namibia High Court The judgment stayed the implementation and application of the provisions of the … Continue reading

‘Fraudulent devices’

By Patrick Bracher (ZA) on September 19, 2018 Posted in Insurance

The English Supreme Court had the following to say regarding the standard insurance policy fraud clause which excludes liability if the insured makes a claim ‘by fraudulent devices’. The court said: ‘The expression is borrowed from a standard clause avoiding contracts of fire insurance which was widely used in the 19th and early 20th Centuries. … Continue reading

Strip club not covered for credit card theft by employees (US)

By Sandra Sithole (ZA) on September 6, 2018 Posted in Insurance

In August 2018, a US federal court ruled that an insurer did not have to cover a strip club for third party reimbursement costs arising from credit card fraud on its customers by the club’s employees because no direct loss was suffered by the club itself. The insured, a club owner, was the holder of … Continue reading

Damage arising from marijuana operations not covered by policy (US)

By Sandra Sithole (ZA) on September 3, 2018 Posted in Insurance

A US appeals court in August 2018 found that an insurer does not have to indemnify its insured for damage to a warehouse by tenants who converted it into a marijuana growing operation, finding that an exclusion in the policy for losses resulting from criminal acts precluded cover. The claim arose under the building and … Continue reading

Competition Commission proposes tough measures on motor insurers

By Mark Griffiths on August 26, 2018 Posted in Insurance

On 1 August 2018, the Competition Commission called for final comments on its far-reaching Code of Conduct for Competition in the Automotive Industry. The code will materially impact a range of stakeholders, including motor insurers. This consultation is the last opportunity for stakeholders to comment before they decide whether or not to sign up to … Continue reading