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ARTICLE · 06 MAY 2020

A good reminder about an insurance brokers duty to ask and advise

Gilchrist Connell
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Insurance broker breached its retainer & was negligent for failing to properly advise re potential exposure to copyright infringement.

AustraliaInsurance
Jamie Ling
Jamie Ling
Kaye Lai
Kaye Lai
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On 19 February 2020, the Federal Court of Australia delivered its decision in PC Case Gear Pty Ltd v Instrat Insurance Brokers Pty Ltd (in liq) [2020] FCA 137, finding that an insurance broker breached its retainer and was negligent for failing to properly advise its client of its potential exposure to copyright infringement.

Facts

PC Case Gear (PCCG) conducted an online business selling and distributing computer hardware, accessories and software. CCG installed Microsoft's Windows operating systems into its customers' custom-made computers. It purchased Windows licenses from a third-party distributor.

Between 2009 and 2016, PCCG engaged Instrat Insurance Brokers (Instrat) as its insurance broker to prepare and provide annual insurance plans and procure for PCCG the cover described in those plans. During that period, PCCG held a combined professional indemnity and public liability policy procured through Instrat, which expressly excluded cover for copyright

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