Supreme Court endorses wide exclusion in professional indemnity insurance policy

Impact Funding Solutions Limited v AIG Europe Insurance Ltd [2016] UKSC 57, 26 October 2016

Impact Funding entered into agreements with Barrington Support Services Ltd to provide loans to Barrington’s clients in order to fund disbursements during the course of those clients’ litigation. Unfortunately, Barrington was negligent in its conduct of its clients’ claims and misapplied the funds advanced to its clients, breaching the terms of the agreements with Impact. Consequently, Barrington became insolvent, and Impact Funding sought to recover the outstanding sums from Barrington’s professional indemnity insurers, AIG.