Astrazeneca Insurance Company Ltd v XL Insurance (Bermuda) Ltd & Anor

Astrazeneca Insurance Company Ltd v XL Insurance (Bermuda) Ltd & Anor

The Policy only provides indemnity where the insured demonstrates actual legal liability, not merely alleged or settled liability. Defense Costs are recoverable only when actual legal liability is established, not as a free-standing entitlement. Policy wording and English law principles do not support indemnity for...

Source-derived case information.

Parties
Claimant: AstraZeneca Insurance Company Limited; Defendant: XL Insurance (Bermuda) Ltd; Defendant: ACE Bermuda Insurance Ltd.
Jurisdiction
England and Wales
Judgment Date
28 February 2013
Procedural Posture
Commercial Insurance Dispute / Judgment on Preliminary Issues
Outcome
Judgment for Defendants on both preliminary issues
Legal Topics
Liability Insurance, Policy Interpretation, Reinsurance, Product Liability, Defense Costs
Insurance Law Contract Law Liability Insurance Policy Interpretation Reinsurance Product Liability Defense Costs

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Parties

AstraZeneca Insurance Company Limited

Claimant

XL Insurance (Bermuda) Ltd

Defendant

ACE Bermuda Insurance Ltd.

Defendant

Procedural Posture

Commercial Insurance Dispute / Judgment on Preliminary Issues

Legal Issues

  1. 1 Does the Policy indemnify for settled alleged liability or only actual legal liability?
  2. 2 Is there a free-standing entitlement to indemnity for Defense Costs irrespective of actual legal liability?

Ratio Decidendi

The Policy only provides indemnity where the insured demonstrates actual legal liability, not merely alleged or settled liability. Defense Costs are recoverable only when actual legal liability is established, not as a free-standing entitlement. Policy wording and English law principles do not support indemnity for arguable or alleged liability.

Court Disposition

Judgment for Defendants on both preliminary issues

Orders

  • Insured is only entitled to indemnity under the Policy where actual legal liability is demonstrated.
  • Indemnity for Defense Costs is only available where actual legal liability is established.