These were further reasons which weighed against against granting the injunction. In addition, he also concluded that ordering the injunction would place the coverholder in breach of authorised sub-delegated authority agreements (and the other party to those agreements also in breach), and would place policyholders in a difficult position. In contrast, the insurer’s interests could be protected by an award of damages at the main trial. In particular, he held that the coverholder’s business interests in running off the covers precluded the insurer from obtaining this injunction. The Judge refused to grant the injunction sought. In this recent case, the insurer sought to restrain its coverholder from handling the run off of ATE legal expenses insurance under a binding authority the insurer had purported to terminate.
Insurers should not assume that such relief will be granted as of right. A recent Commercial Court decision highlights the difficulties insurers face when applying for an injunction against coverholders.
