In England, an Insured Under a Liability Policy Must Demonstrate Actual Legal Liability to be Indemnified by its Insurers

The insured in this case, Astrazeneca Insurance Company Ltd (AIC), was the captive insurance company for the Astrazeneca group of companies (AZ) and provided liability insurance cover for the period 1 January 2001 to 31 December 2003. AIC was reinsured for a 50 percent share by XL and others (XL) for the same period. The insurance provided by AIC to AZ was on what is called a Bermuda Form liability insurance. Bermuda Forms were introduced in the mid-1980s and are contracts of insurance or reinsurance …

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