Articles

Follow Clauses

Authors: Dougal Langusch and Paul O’Brien

In (1) San Evans Maritime Inc (2) Livanbros Maritime SA (3) Mrs Chariklia Livanou v Aigaion Insurance Co SA [2014] EWHC 163 (Comm), the High Court of Justice in England determined preliminary questions about whether a following co-insurer was required to follow a settlement reached between the insured and three Lloyd’s syndicates (including the lead underwriter).

The outcome is notable because the co-insurer was required to follow a settlement, even though the lead insurers purported not to bind the co-insurer in settling the claim.  This result presents potential issues in cases where following insurers are dissatisfied with a settlement entered into by the lead.

Significant cases, legislation or articles referred to:

Download PDF of Article