Generally every Claimant would like to know what the Defendant’s insurance policy says. It will help to understand whether to pursue the case, how much money it is worth spending and where to pitch settlement offers. It may also indicate the level of involvement which might be expected by an insurer in any proceedings.
However, generally the Defendant does not have to reveal it. It is considered irrelevant to the underlying facts of most disputes and consequently not a document which has to be provided as part of disclosure.
However, in the case of XYZ v various companies a small chink has appeared in this armour. The judge in that case has broken with the usual rule and required the disclosure of a Defendant’s insurance policy not to the Claimant but to the Court (i.e. herself).
The rationale was that, if the defendant’s insurance was insufficient to fund it thought to trial, then the case was likely to be abandoned. In order effectively to manage this case, the judge therefore wanted to see the policy to understand what impact it might have upon directions, trial dates and case management.
The Claimant has still not obtained the policy. However, it seems likely that any case management decision now made by the judge will be influenced by her having seen the policy. That in turn may inform the Claimant, who may also choose to act tactically in the knowledge that the Judge will respond in light of her knowledge of the Defendant’s insurance position.
Insured parties entering disputes and insurers generally should take note of the potential shift in balance between parties arising from a judge having the policy.