Allianz Australia's attempt to cap sexual misconduct coverage under a professional indemnity policy issued to the Uniting Church has been rejected by the Federal Court.
Justice Lee handed down the decision on April 28, 2026, in Allianz Australia Insurance Ltd v Uniting Church in Australia Property Trust [2026] FCA 511, dismissing the insurer's application with costs. The case was filed as NSD 1050 of 2022.
At the heart of the dispute was a professional indemnity policy covering the period March 31, 2008 to March 31, 2009. The policy schedule set a limit of indemnity at $25 million any one claim and in the aggregate. But a table sitting just below that figure - under the heading "Reinstatement" - listed "Sexual Abuse" with a separate limit of $15 million and nil reinstatements.
Allianz argued that this structure revealed a mistake. The insurer wanted the policy rectified so that it expressly stated a $15 million aggregate sublimit for sexual misconduct claims, separate from the broader $25 million limit. To back up its case, Allianz pointed to a Marsh placement advice dated March 31, 2008, which provided for a limit of indemnity of "25,000,000 any one claim plus one automatic reinstatement, except $15,000,000 aggregate for Sexual Misconduct." Allianz said that language should have made it into the final policy.
The respondents - various property trusts and associated bodies of the Uniting Church - pushed back. They produced a trail of emails showing the $15 million sexual misconduct figure was never locked in. Instead, it was provisional and tied to ongoing reinsurance negotiations between Allianz, Swiss Re, and Hannover Re.
One email stood out. Marsh broker Bernard Dennis wrote to the Uniting Church's Scott Driscoll on March 31, 2008, noting: "We are awaiting the outcome of discussions between Allianz and their reinsurers in regard to the possibility of increasing the Sexual Misconduct limit to $25m." The very next day, Dennis followed up, confirming that "Allianz continue[s] to seek support in the reinsurance market for an increase in the limit of indemnity for Sexual Misconduct from $15m to $25m."
Justice Lee found the placement advice captured a moment in negotiations - not a final deal. His Honour pointed to differences between the placement advice and the executed policy, including the addition of excluded insureds and extensions that never appeared in the placement advice. Those discrepancies suggested the policy was not simply a copy of that earlier document but reflected further decisions made before execution on July 8, 2008.
The Court noted that rectification is a remedy to be "used with extreme care and caution," and that convincing proof is needed to override what an executed policy says on its face. Allianz's evidence, taken as a whole, did not clear that bar.
Allianz called no witnesses. Justice Lee declined to hold that against the insurer, given the negotiations took place 18 years ago and any recollections would carry far less weight than the documents themselves.
The takeaway for the industry is clear: what the executed policy says matters most - and placement advice, no matter how detailed, may not be enough to rewrite it after the fact.
