HFW Briefing: Insurance brokers’ E&O duties regarding unusual policy terms: Is there a “duty to nanny”?
The law is quite clear that an insurance broker owes a duty to draw its client/insured’s attention to any unusual or onerous policy terms and to explain their nature and effect. This allows the insured the chance to comply with such terms and/or to obtain alternative cover if it chooses: Ground Gilbey v Jardine Lloyd Thompson [2012].
Mr. Justice Jacobs’ recent decision in ABN AMRO Bank –v– [Underwriters] and Edge Brokers (London) [2021] EWHC 442 (Comm), discusses two different, distinct and novel questions which may arise when an unusual term is included in an insurance policy, namely: (1) does the broker owe Underwriters a duty to explain (to Underwriters) the unusual term and/or (2) does the broker owe the insured a duty to explain (to Underwriters) an unusual term?
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