The Law of Reinsurance by Edelman, Colin -- Read -- Imperial Library of Trantor

Index

THE LAW OF REINSURANCE

FOREWORD TO THE FIRST EDITION FOREWORD TO THE SECOND EDITION PREFACE CONTENTS–SUMMARY CONTENTS–DETAILED TABLE OF CASES TABLE OF LEGISLATION 1 FUNCTIONS, DEFINITIONS, AND TYPES OF REINSURANCE

A. Historical Background B. The Functions of Reinsurance C. Parties to a Reinsurance Contract D. Fronting E. Retrocession F. A Legal Definition of Reinsurance G. Types and Methods of Reinsurance

(1) Proportional Reinsurance (2) Non-Proportional Reinsurance

H. Facultative and Treaty Reinsurance I. Facultative Reinsurance

(1) Proportional Facultative Reinsurance (2) Non-Proportional Facultative Reinsurance

J. Treaty Reinsurance K. Proportional Treaty Reinsurance

(1) Quota Share (2) Surplus

L. Non-Proportional Treaties

(1) Excess of Loss (2) Stop Loss (3) Excess of Loss Ratio (4) Aggregate Excess of Loss

M. A Hybrid Method of Reinsurance—Facultative Obligatory

2 THE FORMATION OF THE REINSURANCE CONTRACT

A. Elements of a Contract

(1) Offer (2) Acceptance (3) Consideration (4) Complete and Certain Terms (5) Formality

B. Slips and Policies

(1) The Slip (2) Information on the Slip (3) Scratching the Slip (4) Contractual Nature of the Slip (5) The Slip Policy (6) Writing Down (7) Formal Policy Wording (8) Binders and Line Slips (9) Policy Amendments (10) Leading Underwriters

C. Formation of Treaties D. Writing Reinsurance at Lloyd’s E. Brokers and Intermediaries

3 THE REINSURANCE CONTRACT—CONSTRUCTION AND TERMS

A. Construction of Reinsurance Contracts

(1) The Modern Approach to Construction (2) Presumption of Co-Extensive Cover (3) Full Reinsurance Clause (4) Slip as an Aid to Construction of Policy

B. Incorporation

(1) Does the Clause Make Sense Without Undue Manipulation? (2) Is the Clause Germane? (3) Is the Clause Consistent? (4) Is the Clause Otherwise Inapposite? (5) Unusual Clauses (6) Effect of Incorporation (7) Reinsured’s Ability to Amend Insurance (8) Arbitration Clauses (9) Exclusive Jurisdiction Clauses (10) Choice of Law Clauses85 (11) Errors and Omissions Clauses

C. Implied Terms92

(1) Businesslike Obligations (2) Retention (3) Withholding Approval of Settlements113 (4) Provision of Documents and Information (5) Costs of Defending, Investigating or Settling Claims124 (6) Obligation to Follow Judgment Entered Against the Reinsured

4 OBLIGATIONS OF THE REINSURER

A. Reinsurer’s Obligation to Indemnify the Reinsured B. Obligation to Follow any Judgment Entered Against the Reinsured C. Loss Settlements Clauses D. Follow the Settlements

(1) Burden of Proof (2) Risks Covered by the Reinsurance Policy (3) Ex Gratia Payments (4) Proper and Businesslike Steps (5) Fraudulent Claim (6) Commutation Agreements (7) Effect of a Claims Co-operation Clause

E. ‘Pay as may be Paid Thereon’/‘Pay as may be Paid Thereon and to Follow their Settlements’ F. Follow the Fortunes G. Diminution of the Loss H. Aggregation

(1) One Event/One Occurrence (2) Originating Cause/One Source or Original Cause (3) Binding the Reinsurer to the Reinsured’s Determination on Aggregation (4) Different Aggregation Clauses in the Direct Insurance and Reinsurance Policies (5) ‘Conditions as underlying’

I. Losses Discovered or Claims Made Clause J. Aggregate Extension Clauses K. Limitation122

(1) When does the Reinsurer’s Liability to Indemnify its Reinsured Arise? (2) Excess of Loss Reinsurance (3) ‘Actually paid’ (4) ‘Pay to be paid’

5 RIGHTS OF THE REINSURER

A. Payment of Premium

(1) Premium Warranty Clause (2) Implied Term (3) Repudiation (4) ‘Premiums and claims to be settled in account’

B. Claims Co-operation Clause/Claims Control Clause

(1) Typical Features of Claims Co-operation/Control Clauses

(a) Notification of loss16 (b) Consultation/co-operation in claims handling (c) Control of negotiations and settlement

(2) Costs of Litigation where the Reinsurer has Withheld its Approval31 (3) Claims Co-operation Clause: A Condition Precedent? (4) Consequences of Breach of a Claims Co-operation/Control Clause which is not a Condition Precedent (5) Qualification of the Reinsurer’s Rights under a Claims Co-operation Clause

C. Inspection of Reinsured’s Records D. Declaratory Relief E. Subrogation

6 DENYING LIABILITY

A. Non-disclosure and Misrepresentation

(1) The Duty of Utmost Good Faith (2) Discharging the Duty of Utmost Good Faith (3) Post-contractual Duty of Utmost Good Faith

B. Elements of the Duty of Utmost Good Faith

(1) Materiality (2) Inducement (3) Knowledge of the Reinsured (4) Facts Within Knowledge of Reinsurer

(a) Where the reinsurer is put on inquiry (b) Ordinary incidents and attributes of risk (c) Common public knowledge

(5) Waiver

C. Breach of the Duty of Utmost Good Faith

(1) Avoidance (2) Affirmation

D. Conditions and Warranties

(1) General Conditions (2) Conditions Precedent (3) Warranties (4) Breach of Warranty (5) Waiver by Election or Estoppel

E. Notification

(1) Facultative Proportional Reinsurance (2) Treaty Reinsurance (3) Excess of Loss Reinsurance

F. Limitation

(1) Time Runs from Ascertainment of the Reinsured’s Liability169 (2) Prior Wrong Results in Earlier Time Bar (3) Time Runs from Original Insured Loss or Event (4) Time Runs from Payment by Reinsured (5) Time Runs from Rendering of Accounts (6) Standstill Agreements

7 APPLICABLE LAW AND JURISDICTION

A. Applicable Law

(1) Rome Convention and Rome I Regulation on Conflicts of Laws (2) Express or Implied Choice of Law (3) Applicable Law where there is No Express or Implied Choice of Law (4) Floating Choice of Law Clause (5) The Effect of Different Governing Laws

B. Jurisdiction

(1) The Position of Defendants Domiciled in the European Union and the European Free Trade Association (2) The Position in Respect of Defendants Domiciled Outside the European Union and the European Free Trade Association

GLOSSARY INDEX

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