Massive Claim Leads to Insurance Disclosure Ruling

The High Court recently ruled that a claimant was entitled to know the extent of the insurance carried by the defendant in order to be satisfied that the defendant would be able to settle the claim should the award be substantial. The request to know was related to a claim for damages running into seven figures brought by a gymnast who had suffered severe spinal injuries. The claim was expected to be in the region of £8-10m and it was agreed that the defendant would be 75 per cent liable. All that remained to be negotiated was the value of the claim, but the costs of doing so were likely to be high.

The ruling was sought because the claimant had genuine concern that he might not recover the whole of the award after costs if the defendant’s insurance cover was inadequate. The costs incurred were already very substantial, as is common in cases involving claims of this size.

The defendant’s insurers argued against divulging the information on various grounds, including that it would place them at a disadvantage as regards their negotiating position and that the claimant was not a party to their contract of insurance with the defendant and thus was not entitled to know the terms of the policy.

The Court considered that the claimant’s concerns were genuine and, given that the further costs were likely to be significant, the defendant could not withhold the information sought.