Broker’s negligence claims relating to liability policies do not require actual liability (Norman Hay Marsh Ltd)
Insurance & Reinsurance analysis: This is a Court of Appeal decision on a reverse summary judgment/strike out application in a broker’s negligence case. The case concerned ‘non-owned auto cover’, ie motor liability insurance cover in relation to the hiring of cars. Marsh appealed against the dismissal of its application on two grounds: (i) there was no allegation of actual liability, which was necessary for a claim under a liability policy; and (ii) the losses claimed were irrecoverable as reflective loss. The court dismissed the appeal on both grounds. The case decision highlights the important distinction in terms of causation between a claim under a liability policy, and a claim against a broker for negligently failing to place a liability policy. Written by Louis Zvesper, barrister at Gatehouse Chambers.