Case Law confirmation: No "spiking" of mesothelioma employers' liability (EL) claims at the reinsurance level.

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Following an "at the (Supreme) Court doors" settlement, the Court of Appeal decision in Equitas Insurance Limited v Municipal Mutual Insurance Limited stands, as the case was discontinued ahead of its planned Supreme Court hearing this month.

Following last year's decision by the Court of Appeal (overturning an earlier ruling by Lord Justice Flaux, sitting as judge-arbitrator) that "spiking" of employers' liability mesothelioma claims was not permitted at the reinsurance level, a Supreme Court hearing of the appeal by MMI was due to take place earlier this month.

Following settlement of the claim between the parties, that hearing did not go ahead. Accordingly, the Court of Appeal decision stands and "spiking" of EL mesothelioma claims at the reinsurance level is not permitted. Rather, losses must be presented to reinsurers on the basis of a pro rata allocation by reference to time on risk.

For a full discussion of the background to the case, and discussion of the Court of Appeal ruling, see our earlier Engage Post.

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