COURSE MANUAL Insurance Law & Practice

Format approved by the Academic Review Board, JGLS

COURSE MANUAL

Insurance Law & Practice

Fall 2021

(AY 2021-22)

Name of Faculty

Professor Fouzia Zafar


CONTENTS

PART I

General Information………………………………………………………………………………Page

PART II

a. Course Description…………………………………………………………………………………Page

b. Course Aims……………………………………………………………………………………..Page

c. Intended Leaning Outcomes ……………………………………………………...........Page

d. Grading of Student Achievement………………………………………………….......Page

PART III

a. Keyword Syllabus……………………………………………………………………………Page

b. Course Policies………………………………………………………………………………..Page

PART IV

a. Weekly Course Outline ………………………………………………………….............Page

b. Readings…………………………………………………………………………………………Page


PART I

General Information

General Information on, Insurance Law & Practice, offered by Jindal Global Law School

of the AY 2021-22 The information provided herein is by the Course Coordinator. The following information contains the official record of the details of the course. This information shall form part of the University database and may be uploaded to the KOHA Library system and catalogued and may be distributed amongst 3rd, 4th and 5th year Law students for B.A.LL.B. (Hons), B.B.A.LL.B. (Hons); B.Com. LL.B. (Hons), B.A. (Hons) Legal Studies, LL.B.; LL.M. courses if necessary.

Course Title: Insurance Law & Practice Course Code: Course Duration: One Semester No. of Credit Units: 4 Level:

Medium of Instruction: English


PART II

a. Course Description

We face many possibilities of suffering a loss in our daily lives – property loss, disabling

accidents, health-related expenses or potential liability to another party. Commercial

entities must also deal with risks of financial loss irrespective of their size or type of

operation. Public and private companies take out directors and officers’ liability

insurance to cover claims against their directors due to the increasingly onerous nature

of duties and responsibilities placed on directors. Given the size of their operations,

companies dealing with natural resources like, oil, gas and coal buy business

interruption or political risks insurance. Pharmaceutical companies take out insurance to

cover human clinical trial exposures. Information technology companies buy intellectual

property insurance to protect against losses arising from an infringement lawsuit. Banks

purchase liability insurance to protect them from claims alleging mismanagement of

customer accounts or mis-selling of products. Sometimes taking out of insurance is

even required by law.

The law governing insurance transactions is a specialised area of contract law. This

course examines the fundamental legal principles of insurance law. Whilst most of the

principles are shared by other common law and some civil law jurisdictions, the focus

will be on India and the UK, and comparisons maybe drawn from other jurisdictions.

This course will closely look at the nature of insurance, the fundamental components of

insurance contracts, the various classes of insurance, subrogation, and the role and

duties of insurance intermediaries. The examination will be conducted from theoretical

and practical perspectives. Consideration will also be given to policy reasons underlying

the law, and how these reasons influence the application of the law. In addition, the

course will analyse the structure of the regulatory framework governing insurance

business.

The course is international in focus, and therefore reference will be made to the law and

scholarly material from other jurisdictions, primarily the US and the UK.

b. Course Aims

The course aims to develop knowledge and skills, which are required to acquire an in-depth conceptual understanding of an insurance contract and the law which governs the contract. By the end of the course, students should be able to read and interpret an


insurance contract from a lawyers point of view. The course also aims to develop understanding of the regulation of the insurance industry in India.

c. Intended Learning Outcomes

Course Intended Learning Outcomes

Weightage Teaching and

Learning

Activities

Assessment

Tasks/ Activities

By the end of the course, students

should be able to:

Understand the general nature of the

obligations placed on the insurer and

the insured

40%

Demonstrate their knowledge of the key

features of an insurance contract

40%

Understand and critically assess the role

of regulation in the insurance industry

20%

d. Grading of Student Achievement1,2 To pass this course, students must obtain a minimum of 40% in the cumulative aspects of

coursework, e.g. moot, and final examination. End of semester exam will carry 50 marks out of

which students have to obtain a minimum of 15 marks to fulfil the requirement of passing the course. The details of the grades as well as the criteria for awarding such grades are provided below.

Letter Grade

Percentage Of marks

Grade Definitions

O 80% and above Outstanding Outstanding work with strong evidence of knowledge of the

1 Under extraordinary circumstances, the JGU Academic Council or the JGU Deans’ Council can suspend

Clause D or make it optional. If Clause D is suspended, the policy which will be framed by the School based on the decision of the said bodies will supersede Clause D. However, whether a situation is extraordinary or not will be decided by the said bodies only.

2 Due to the COVID 19 pandemic, the Office of Academic Affairs may suggest changes/amendments or suspend certain policies relating to the number of assessments and other examination related policies.


subject matter, excellent organizational capacity, ability to synthesize and critically analyse and originality in thinking and presentation.

A+ 75 to 79.75% Excellent Sound knowledge of the subject matter, thorough understanding of issues; ability to synthesize critically and analyse

A 70 to 74.75% Good Good understanding of the subject matter, ability to identify issues and provide balanced solutions to problems and good critical and analytical skills.

A- 65 to 69.75% Adequate Adequate knowledge of the subject matter to go to the next level of study and reasonable critical and analytical skills.

B+ 60 to 64.75% Marginal Limited knowledge of the subject matter, irrelevant use of materials and poor critical and analytical skills.

B 55 to 59.75% Poor Poor comprehension of the subject matter;


poor critical and analytical skills and marginal use of the relevant materials.

B- 50 to 54.75% Pass “Pass” in a pass-fail course. “P” indicative of at least the basic understanding of the subject matter.

NEW COURSE LETTER GRADES AND THEIR INTERPRETATION

Letter Grade

Percentage of Marks

Grade Points

Interpretation

P1 45 - 49 2 Pass 1: Pass with Basic understanding of the subject matter.

P2 40 - 44 1 Pass 2: Pass with Rudimentary understanding of the subject matter.

F Below 40 0

Fail: Poor comprehension of the subject matter; poor critical and analytical skills and marginal use of the relevant materials. Will require repeating the course.

P Pass

‘P’ represents the option of choosing between Pass/Fail grading system over the CGPA grading system in the COVID 19 semester in Spring 2020. The option is provided when students attain a minimum of 40 percentage marks under the current grading structure in a given subject.

I Incomplete

Extenuating circumstances preventing the student from completing coursework assessment, or taking the examination; or where the Assessment Panel at its discretion assigns this grade. If an "I" grade is assigned, the Assessment Panel will suggest a schedule for the completion of work, or a supplementary examination.

PART III

a. Keyword Syllabus

Risk; Indemnity; Insurable Interest; Utmost Good Faith; Disclosure; Misrepresentation;

Marine Insurance Act 1962; IRDAI, Proposal Form; Material Circumstances; Slip;


Endorsement; Cover Note; Premium; Warranties; Conditions; Loss; Efficient Cause; Claims;

Liability Insurance; Claims Made, Loss Occurring; Life Insurance; Subrogation; Brokers;

Agents; Reinsurance; Lloyd’s

b. Course/Class Policies Cell Phones, Laptops and Similar Gadgets

Use of mobile phones by students during the lectures will be at the instructor’s discretion.

Cell phones must be kept on silent or do-not-disturb mode to avoid disturbing the lecture.

Use of laptops and similar gadgets may be allowed upon the instructor’s discretion for

learning purposes.

Academic Integrity and Plagiarism

Learning and knowledge production of any kind is a collaborative process. Collaboration demands an ethical responsibility to acknowledge who we have learnt from, what we have learned, and how reading and learning from others have helped us shape our own ideas. Even our own ideas demand an acknowledgement of the sources and processes through which those ideas have emerged. Thus, all ideas must be supported by citations. All ideas borrowed from articles, books, journals, magazines, case laws, statutes, photographs, films, paintings, etc., in print or online, must be credited with the original source. If the source or inspiration of your idea is a friend, a casual chat, something that you overheard, or heard being discussed at a conference or in class, even they must be duly credited. If you paraphrase or directly quote from a web source in the examination, presentation or essays, the source must be acknowledged. The university has a framework to deal with cases of plagiarism. All form of plagiarism will be taken seriously by the University and prescribed sanctions will be imposed on those who commit plagiarism.

Academic Integrity and Plagiarism

Learning and knowledge production of any kind is a collaborative process. Collaboration demands an ethical responsibility to acknowledge who we have learnt from, what we have learned, and how reading and learning from others have helped us shape our own ideas. Even our own ideas demand an acknowledgement of the sources and processes through which those ideas have emerged. Thus, all ideas must be supported by citations. All ideas borrowed from articles, books, journals, magazines, case laws, statutes, photographs, films, paintings, etc., in print or online, must be credited with the original source. If the source or inspiration of your idea is a friend, a casual chat, something that you overheard, or heard being discussed at a conference or in class, even they must be


duly credited. If you paraphrase or directly quote from a web source in the examination, presentation or essays, the source must be acknowledged. The university has a framework to deal with cases of plagiarism. All form of plagiarism will be taken seriously by the University and prescribed sanctions will be imposed on those who commit plagiarism.

Disability Support and Accommodation Requirements

JGU endeavors to make all its courses accessible to students. All students with any known disability needing academic accommodation are required to register with the Disability Support Committee [email protected]. The Committee has so far identified the following conditions that could possibly hinder student’s overall well-being. These include: physical and mobility related difficulties; visual impairment; hearing impairment; medical conditions; specific learning difficulties e.g. dyslexia; mental health.

The Disability Support Committee maintains strict confidentiality on the matters under its purview. Students should preferably register with the Committee during the month of June/January as disability accommodation requires early planning. DSC will coordinate all disability related services such as appointment of academic mentors, arranging infrastructural facilities, and course related requirements such as special lectures, tutorials and examinations.

All faculty members are requested to refer students with any of the above-mentioned conditions to the Disability Support Committee for getting them disability-related accommodation. Faculty members are also requested to be sensitive to the needs of such students and cooperate with Disability Support Committee and the School, extending students the necessary support by maintaining utmost confidentiality of the matter.

Safe Space Pledge

This course may discuss a range of issues and events that might result in distress for some students. Discussions in the course might also provoke strong emotional responses. To make sure that all students collectively benefit from the course, and do not feel disturbed due to either the content of the course or the conduct of the discussions. Therefore, it is incumbent upon all within the classroom to pledge to maintain respect towards our peers. This does not mean that you need to feel restrained about what you feel and what you want to say. Conversely, this is about creating a safe space where everyone can speak and learn without inhibitions and fear. This responsibility lies not only with students, but also with the instructor.

P.S. The course instructor, as part of introducing the course manual, will discuss the scope of the Safe Space Pledge with the class.



PART IV

a. Weekly Course Outline

Week 1

The Nature of Insurance

Weeks 2

Insurable Interest

Week 3 & 4 Duty of Utmost Good Faith

Weeks 5

Formation of Insurance Contract & Premium

Week 6

Principles of Construction

Week 7 & 8

Terms of Insurance Contracts

Week 9

Insurance Claims & Causation

Week 10

Life, Property, Liability Insurance

Week 11

Subrogation

Week 12

Reinsurance

Week 13

Insurance Intermediaries

Week 14 Regulation of the Market and Reforms Week 15 Guest Lecture/Revision


b. Readings

WEEK 1 - THE NATURE OF INSURANCE

Insurance forms an important part of law, economy and society. It may be identified as a legal

mechanism through which risk is identified and allocated to the insurer in return for payment of

a premium. On a more general and macro level, it may be seen as spreading loss across a risk

pool so that loss does not fall on a few people. Apart from these broader conceptions of

insurance, we will explore the legal definitions of insurance adopted for particular purposes,

specifically regulatory.

We will look at some classifications of insurance (first party, third party etc). We will then

consider the insurance contract, which is a specialised contract.

Essential Reading

1. Insurance Act 1938, definitions of insurance company, insurer; policyholder and Section

2C

2. Indian Contract Act, 1872, section 30

3. Marine Insurance Act 1963, Section 6

4. Birds’ Modern Insurance Law, John Birds (Sweet & Maxwell, 9th edition), Chapter 1

5. Modern Law of Insurance, KSN Murthy & Dr KVS Sarma (LexisNexis, fourth edition), pp

51 to 54 and 59 to 69

Recommended Reading K Abraham, ‘Four Conceptions of Insurance’ (2013) 161 U Penn Law Review 653


WEEK 2 - INSURABLE INTEREST

A key distinctive characteristic of an insurance contract is the requirement of insurable interest.

There are rules as to nature, timing and amount of insurable interest, and we will discuss these

rules to work out their underlying rationale. The requirement of insurable interest is said to be

based on the principle of indemnity, and we will closely examine the principle to develop an

understanding of the significance of insurable interest.

Essential Reading

1. Marine Insurance Act 1963, Sections 7 – 10


3. Dalby v India & London Life Assurance Society (1854) 15 CB 364; Lucena v Craufurd

(1806) 2 B & PNR 269; Macaura v Northern Assurance Co Ltd 122 [1925] AC 619; Feasey

v Sun Life Assurance Corporation of Canada [2003] Lloyd’s Rep IR 640; Constitution

Insurance Co. of Canada v Kosmopoulos (1987) 34 DLR (4th) 208; Contship Container

Lines Limited v D. K. Lall and Others; DM United India Insurance v Amarjeet Singh

Recommended Reading

1. K Abraham, ‘Four Conceptions of Insurance’ (2013) 161 U Penn Law Review 653 2. J Birds, ‘Insurable Interest – Orthodox and Unorthodox Approaches’ (2006) JBL 224

3. Insurance and the Law of Obligations, Rob Merkin and Jenny Steele (OUP, 2013),

Chapter 2 – Characterizing Insurance

4. Law Commission & Scottish Law Commission: Reforming Insurance Contract Law: Issue

Paper 10: Insurable Interest: Updated Proposals 27 March 2015

(http://www.lawcom.gov.uk/wp-

content/uploads/2015/06/ICL10_insurable_interest_issues.pdf)

5. Law Commission & Scottish Law Commission: Insurable Interest: Current Law March

2015 (http://www.lawcom.gov.uk/wp-

content/uploads/2015/06/cp201_extract_insurable_interest.pdf)

http://www.lawcom.gov.uk/wp-content/uploads/2015/06/ICL10_insurable_interest_issues.pdf

http://www.lawcom.gov.uk/wp-content/uploads/2015/06/ICL10_insurable_interest_issues.pdf

http://www.lawcom.gov.uk/wp-content/uploads/2015/06/cp201_extract_insurable_interest.pdf

http://www.lawcom.gov.uk/wp-content/uploads/2015/06/cp201_extract_insurable_interest.pdf


WEEKS 3 & 4 - DUTY OF UTMOST GOOD FAITH

A duty of utmost good faith is attached to insurance contracts. This is a doctrine which is unique to insurance contracts. One aspect of this duty is that a policyholder must disclose all material facts to the insurer before entering into the contract. This is in contrast with contract law generally where a party must not misrepresent facts but is under no obligation to disclose a fact if he is not asked about it. There is a distinction between pre and post-contractual duty of utmost good faith. We will review the law on what amounts to pre-contractual non-disclosure, material facts and misrepresentation, and the legal consequences of failing to comply with the duty. We will also review the scope of the duty in particular instances, for example, with regards to a company. Finally, we will examine how the doctrine has been modified in the UK with regards to consumer insurance contracts as a result of the coming into force of the Consumer Insurance (Disclosure and Representations) Act 2012 and the Insurance Act 2015. Essential Reading

1. Marine Insurance Act 1963, sections 19, 20, 21 & 22

2. Indian Contract Act section 18

3. Insurance Act 1938 with reference to ‘Life Insurance Contracts’ 4. Carter v Boehm (1766) 3 Burr 1905; Pan Atlantic Insurance Co v Pine Top Insurance Co

[1994] 3 All ER 581; [1994] 3 WLR 677; LIC v Sakunthalabai AIR 1975 AP 68; Rohini Nandan v Ocean Accident and Guarantee Corp AIR 1960 Cal 969; Arab Bank plc v Zurich Insurance Co [1998] CLC 1351; Reliance Life Insurance Ltd & Anr v Rekhaben Nareshbhai Rathod 2019 SCC Online SC 590; Satwant Kaur Sandhu v New India Assurance Company Ltd. 2009 8 SCC 316; Oriental Insurance Company Limited v Mahendra Construction 2019 SCC Online SC 541; Life Insurance Corporation of India v Manish Gupta 2019 SCC Online 593; Max New York Life Insurance Company v Gitaben NCDRC New Delhi 5 February 2018

5. Modern Law of Insurance, KSN Murthy & Dr KVS Sarma (LexisNexis, fourth edition),

Chapter 6, pp 43 to 51


Recommended Reading

1. Consume Insurance (Disclosure and Representations) Act 2012 (UK) 2. Law Commission & Scottish Law Commission Report on Insurance Contract Law, July

2014, Chapter 30 – Good Faith (http://www.lawcom.gov.uk/wp-content/uploads/2015/03/lc353_insurance-contract-law.pdf)

3. Hasson, ‘The Doctrine of Uberrima Fides in Insurance Law: A Critical Evaluation’ (1969) 32 MLR 615

http://www.lawcom.gov.uk/wp-content/uploads/2015/03/lc353_insurance-contract-law.pdf



WEEK 5 - FORMATION OF INSURANCE CONTRACT & PREMIUM

We will discuss what constitutes an offer and acceptance and what must be agreed in order to form an insurance contract. We will examine whether there are standard forms for the various classes of insurance. We will also identify various types of insurance documents, such as schedules, cover notes and endorsements. Premium is the price that the insured pays for which the insurer assumes liability. Premium must be paid at the time stipulated in the contract. We will examine the general rules of payment. Essential Reading

1. Canning v Farquhar (1866) 16 QBD 727; General Assurance Society v Chandumull Jain 86 AIR (1966) SC 1644; Modern Insulators Limited v Oriental Insurance Company Limited; Ratan Lal v Metropolitan Insurance Co.

2. Modern Law of Insurance, KSN Murthy & Dr KVS Sarma (LexisNexis, fourth edition), chapter 6, pp 710to 86

3. Birds’ Modern Insurance Law, John Birds (Sweet & Maxwell, 9th edition), Chapter 5 4. IRDA (Protection of Policyholders’ Interests) Regulations, 2017

Recommended Reading

Barron, ‘Acceptance by Silence and Insurance Contracts’ [2009] JBL 633


WEEK 6 - PRINCIPLES OF CONSTRUCTION

Insurance contracts are notoriously complex legal documents and this week we will consider the rules applicable to construing the language of the insurance contract. Generally, freedom of contract reigns. This has been tempered by IRDA regulations which require that policyholders be treated fairly. There are a number of principles, which are of universal application to all types of insurance. For example, courts construe the objective intention of the parties from the language of the contract as a whole with the background knowledge which would have been reasonably available to the parties at the time that they entered into the contract. Words are also given their ordinary meaning unless a technical definition was intended. Essential Reading 1. Gray v Barr; Dhak v Insurance Company of North America; Christopher Parke v Royal London

Mutual Insurance Society; Smt Alka Shukla v Life Insurance Corporation of India SC 24 April, 2019; National Insurance Co Ltd v Mousumi Bhattacharjee 2019 SCC Online SC 419; Royal Sundaram Alliance Insurance Co Ltd v Pawan Balram Mulchandani NCDCRC; Dino Services v Prudential Assurance Co.



WEEKS 7 & 8 - TERMS OF INSURANCE CONTRACTS

Policy terms define the scope of the rights and obligations of each party. The distinction drawn in contract law between conditions and warranties has no application to insurance. Policy conditions identify the duties of the parties, and usually relate to matters, such as the payment of premium, and making of claims. We will examine how insurers may further seek to protect themselves by deeming a condition to be a condition precedent to liability. Warranties are of paramount importance because of the special rules applicable to them. We will review case law on warranties to see how courts have interpreted terms to decide whether a warranty has been created, and the consequences of its breach. Due to the draconian consequences flowing from a breach of a warranty, this area of law has been under reform in England. We will briefly examine the Law Commission of England & Wales’ recommendations on reforming insurance law on warranties. We will also briefly look at exceptions/exclusions in policies. Essential Reading

1. Marine Insurance Act 1963, Sections 35 to 37 2. George Hunt Cranes Ltd v Scottish Boiler and General Insurance Co Ltd [2002] Lloy’s Rep

IR 178; The Good Luck [1992] 1 AC 233 at 263; Kler Knitwear Ltd v Lombard General Insurance Co Ltd [2000] Lloyd’s Rep IR 47; Sugar Hut Group Ltd v Great Lakes Reinsurance (UK) plc [2010] EWHC 2636 (Comm); The Newfoundland Explorer [2006] EWCA 429; The Resolute [2008] EWCA Civ 1314; LIC v Shakuntala Bai AIR 1975 AP 68; Messrs Orient Treasures Pvt Limited v United India Insurance Company Ltd

3. Modern Law of Insurance, KSN Murthy & Dr KVS Sarma (LexisNexis, fourth edition), chapter 6, pp 121 to 127


Recommended Reading

1. M A Clark, ‘Insurance Warranties: The Absolute End?’ (2007) Lloyd’s Maritime and Commercial Law Quarterly 474

2. Law Commission & Scottish Law Commission Report on Insurance Contract Law, July 2014, Chapters 13 & 15 (http://www.lawcom.gov.uk/wp-content/uploads/2015/03/lc353_insurance-contract-law.pdf)

3. Insurance Act 2015 (UK) 4. Hasson, ‘The Basis of the Contract Clause in Insurance Law’ (1971) 34 Modern Law Review

29




WEEK 9 - INSURANCE CLAIMS & CAUSATION

Insurance is a promise to pay money or money’s worth on the occurrence of certain circumstances (the ‘insured event’ or ‘insured peril’). When the insured event has occurred, the policyholder can make a claim under the insurance policy. We will examine the usual procedure for making claims. We will look at the issue of fraud and how the law deals with fraudulent claims. Loss must be proximately caused by an insured event in order to be covered, and we will examine case law with respect to this requirement. We will also review a number of defences that an insurer may apply in order to block a claim, such as breach of a condition to notify loss, and fraudulent claims. Essential Reading

1. Direct Line Insurance v Khan [2002] Lloyd’s Rep IR 364; Axa General Insurance v Gottlieb [2005] EWCA Civ 112; Galloway v Guardian Royal Exchange (UK) Limited [2000] Lloyd’s Rep I.R. 209; Leyland Shipping Co. Ltd v Norwich Union Fire Ins. Sy Ltd [1918] AC 350; Verelst's Administratrix v Motor Union Ins. Co. [1925] 2 KB 137

2. Modern Law of Insurance, KSN Murthy & Dr KVS Sarma (LexisNexis, fourth edition), chapter 6, pp 199 to 206

3. Birds’ Modern Insurance Law, John Birds (Sweet & Maxwell, 9th edition), paras. 14.4 to

14.11

Recommended Reading Law Commission & Scottish Law Commission Report on Insurance Contract Law, July 2014, Chapters 25 & 26 (http://www.lawcom.gov.uk/wp-content/uploads/2015/03/lc353_insurance-contract-law.pdf)




WEEKS 10 - LIFE, PROPERTY AND LIABILITY INSURANCE

We will start by reviewing a standard life insurance policy. Traditional life insurance policies pay a fixed sum on the death of the life insured, and therefore are not contracts of indemnity. We will consider the implications for this feature of life insurance policies. We will closely look at section 45 of the Insurance Act 1938 which has modified the duty of utmost good faith as regard life insurance policies. As regards property insurance, we will examine the nature of the risk and the meaning of loss. We will review the usual terms contained in a fire policy, such as the description of the subject matter, exclusions and notifying claims. Liability insurance provides cover for liability to a third party, whether in contract or in tort. We will closely examine public liability insurance, employers’ liability insurance, professional indemnity insurance and directors and officers’ liability insurance. We will consider principles which apply to all liability insurance policies, as well as, those which arise because of specific policy wordings. Essential Reading

1. Fraser v Furman [1967] 1 WLR 898; Tesco Stores v Constable & Others [2008] EWCA Civ

362; Harris v Poland [1941] 69 Lloyd’s Rep 35 (KB); Marsden v City and County Assurance

Co (1865) L.R. 1 C.P. 232

2. Insurance Act 1938, sections 3 to 9 & 45

3. Insurance Laws (Amendment) Act 2015

4. Standard Fire and Special Perils Policy


137 -144, 159 -167, 209 – 229, 309 - 312


7. Example policies to be discussed in class


WEEKS 11 SUBROGATION

Subrogation is a remedy which enables an insurer to stand in the shoes of the insured and bring proceedings to make a recovery from the third party, which is liable for the loss. We will examine the rationale behind this remedy, and why it applies to all insurance contracts of indemnity. We will also consider limitations to the exercise of this remedy. There has been some criticism of the doctrine, and in this light, we will generally explore the role of subrogation. Essential Reading

1. Marine Insurance Act 1963, section 79 2. Castellian v Preston [1883] 11 QBD 380; Horwood & Others v Land of Leather Ltd [2010]

EWHC 546 (Comm); The Board of Trustees of Tate Gallery v Duffy Construction Ltd & Another [2007] EWHC 361 TCC; BP Exploration Operating Company Ltd v Kvaerner Oilfield Products Ltd [2004] EWHC 999 (Comm)


245 to 248


Recommended Reading

R Hasson, ‘Subrogation in Insurance Law – a Critical Evaluation’ (1985) 5 OJLS 416


WEEK 12 - REINSURANCE

Reinsurance is insurance of insurers. It is one of the ways in which insurers spread loss. Reinsurance is written on facultative or treaty basis and we will examine the distinction between the two. We will review issues, such as, the extent to which reinsurance incorporates terms of the original insurance, and discuss when the reinsured’s cause of action accrues against the reinsurer. We will also examine typical issues that arise when claims are made against reinsurers, and the meaning of important reinsurance clauses, such as follow the settlements clause. Essential Reading

1. WASA International Insurance Co v Lexington Insurance Co [2009] UKHL 40; IRB Brasil Resseguros SA v Reinsurance Co Ltd [2010] EWHC 974 (Comm); [2010] All ER (D) 63; Versicheungs und Transport Aktiengesellschaft Daugava v Henderson (1934) All ER Rep 626

2. Insurance Laws (Amendment) Act 2015 3. IRDAI (Re-insurance) Regulations, 2018 4. IRDAI (Registration and Operations of Branch Offices of Foreign Reinsurers Other than

Lloyd’s) Regulations, 2016; IRDAI (Lloyd’s India) Regulations, 2016 5. Colinvaux & Merkin’s Insurance Contract Law, Chapter 1 6. Insurance and the Law of Obligations, Rob Merkin and Jenny Steele (OUP, 2013), pp 146

to 155

Recommended Reading

1. R Merkin, ‘Wasa International Insurance Co v Lexington Insurance Co: Commercial Certainty in the Reinsurance Market’ (2010) 126 Law Quarterly Review 24

2. O Gurses, ‘The Construction of Terms of Facultative Reinsurance Contracts: Is Wasa v Lexington the Exception or the Rule?’ (2010) 73 Modern Law Review 119


WEEK 13 INSURANCE INTERMEDIARIES

Much of the insurance business is conducted through insurance intermediaries. We will examine how agency law operates with respect to insurance brokers and agents, particularly fiduciary duties and duties of reasonable care and skill. We will also consider how these intermediaries are regulated, in terms of their suitability and qualification. We will closely examine issues, such as when the agent’s knowledge is imputed to the principal in relation to the duty to disclose material facts. Essential Reading

1. Insurance Act 1938, sections 2(10), 40 and 42-42C 2. Insurance Regulatory and Development Authority Act 1999, Section 2 3. IRDAI (Appointment of Insurance Agents) Regulations, 2016; IRDAI (Registration of

Corporate Agents) Regulations, 2015 4. IRDAI (Payment of Commission, Remuneration and Rewards to Insurance Agents and

Insurance Intermediaries) Regulations 2016 5. IRDAI (Insurance Web Aggregators) Regulations, 2017; IRDAI (Insurance Brokers)

Regulations, 2018 6. McNealy v Pennine Insurance Co [1978] 2 Lloyd’s Rep 18; Dunbar v A&B Painters Ltd

[1986] 2 Lloyd’s Rep 38; Hindustan Ideal Insurance Co v Gayalakshamma AIR 1959 AP 562 7. Modern Law of Insurance, KSN Murthy & Dr KVS Sarma (LexisNexis, fourth edition), pp

129 to 132 8. Birds’ Modern Insurance Law, John Birds (Sweet & Maxwell, 9th edition), Chapter 12


WEEK 14 - REGULATION OF THE MARKET AND REFORMS

Regulation of the insurance industry aims to ensure that insurers remain solvent, interests of the consumers are protected and the insurance market remains stable. Regulations also seek to control conduct of insurance business. In India, the insurance industry is regulated by a mixture of private law, public law and self-regulation. We will examine the mechanisms by which the insurance industry is regulated in India, how the system compares with other jurisdictions, and critically assesses the effectiveness of regulation. We will examine the role and powers of the Insurance Regulatory and Development Authority (the “IRDA”), and the various regulations and guidelines issued by it. We will also closely examine a number of the provisions of the Insurance Laws (Amendment) Act 2015. We will also closely look at the role, duties and powers of the Insurance Ombudsman. Essential Reading

1. Selected provisions of Insurance Regulatory and Development Authority Act 1999 2. Selected provisions of Insurance Act 1938 & the Amendment Act 2002 3. Selected provisions of Insurance Laws (Amendment) Act 2015 4. Various IRDA regulations, including on advertisements and disclosure, investments and

solvency 5. Selected provisions of the Consumer Protection Act 2019 6. Modern Law of Insurance, KSN Murthy & Dr KVS Sarma (LexisNexis, fourth edition), pp 13

to 21, 29 to 37, 355 to 357 Recommended Reading

1. McMeel, ‘The FSA’s Insurance Conduct of Business Regime: A Revolution in (Consumer) Insurance Law?’ [2005] LMCLQ 186

2. Insurance and the Law of Obligations, Rob Merkin and Jenny Steele (OUP, 2013), Chapter 4 – Regulatory Dimensions


WEEK 15 – GUEST LECTURE/REVISION

A guest speaker, either a practitioner of insurance law, or a faculty member of JGLS, will be invited to give a lecture on an area relevant to insurance law.

COURSE MANUAL Insurance Law & Practice

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