Knowing your stuff.
As the case of Aneco v Johnson & Higgins recently illustrated, brokers must ensure they follow generally accepted duties of care when advising clients or be prepared for costly repercussions. Gary Meggitt explains.
Insurance brokers are not immune from professional negligence claims,a fact that was brought home with a costly bang in Aneco Reinsurance
Underwriting (in liquidation) v Johnson & Higgins.
The House of Lords held that the defendant broker (J&H) had negligently
failed to advise that adequate reinsurance was unavailable for an
insurance treaty that the claimant insurer (Aneco) entered into.
Consequently, the true measure of damages was the full $35m the claimant
lost, not just the $11m reinsurance
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