Jersey’s Royal Court Highlights Potential Concerns For Insurance Industry

The recent case of Cafe de Lecq Limited v R A Rossborough (Insurance Brokers) Limited amounted to a David v Goliath battle for the insurance world in Jersey.

It also put an end to the cry "it's in the small print".

The case has made anyone wishing to rely on an exclusion clause sit up and take notice; but, more importantly for insurers, it saw an expert label so-called 'quote engines' as laying the ground for "the next big miss-selling scandal".

For such an important case the facts are quite simple. On 8 May 2007, Cafe de Lecq burnt down. The cause was agreed to be overheating of cooking oil by a deep fat fryer.

It was also agreed that the insurer was able to decline payment on the policy because of a clause stipulating that deep fat fryers should have a thermostat and automatic cut out system. The fryer in question had no such safety features.