Insurance and reinsurance: new developments in the law of vicarious liability

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Liability insurers need to be aware of the US Supreme Court’s decision in The Catholic Child Welfare Society and others v Various Claimants and the Institute of the Brothers of the Christian Schools [2012] UKSC 56, which represents a further development in the law of vicarious liability.

The decision extended vicarious liability for acts of sexual abuse committed by members of the Institute of the Brothers of the Christian Schools (the Institute) to the Institute in its role as provider of the brothers as teachers to a school and not solely to the school’s manager, the MDRS, which employed the brothers. Lord Phillips observed that the criteria for imposing vicarious liability for sexual abuse are still in the course of refinement by the courts. Insurers will want to keep a close eye on the developments in this area, especially those with significant long tail interests; the allegations in this case spanned the period 1958 to 1992. Consider, for example, the allegations currently engulfing the BBC regarding the sexual abuse of young people who came into contact with some of its employees and their entourages…

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