Lockton has urged organisations with claims-made insurance to treat early warning signs, such as complaints and internal investigations, as potential insurance matters before any formal claim arrives.
The broker’s white paper, published Wednesday, draws on the Full Federal Court’s decision in UCA v Allianz. Damian Burley, client manager for health and community services at Lockton, wrote it. Lockton’s Claims and Health and Community specialists contributed.
The paper covers when circumstances may trigger notification, why timing and specificity matter, how knowledge moves across complex organisations, how operational risk information links to insurance decisions, and a framework to identify, escalate, review and document potential insurance circumstances. Lockton aims it at risk and insurance managers, general counsel, governance and compliance leaders, safeguarding and complaints teams, and senior executives. Brokers who place claims-made programs for such organisations can use the themes to guide client conversations about when to notify.
The dispute involved historical claims linked to Knox Grammar School in Sydney. Allianz issued successive policies to the Uniting Church in Australia between March 31, 1999, and March 31, 2011. The Uniting Church in Australia Property Trust (NSW) sought indemnity for claims by former students.
A report known as LKA2 was given to Knox’s then headmaster in May 2004. Lockton said it contained information that might reasonably have given rise to future claims, but the information was not notified at the time. The Trust did not make four bulk notifications to Allianz until March 2009.
Justice Lee ruled for the Trust in March 2023. The Full Federal Court overturned that decision in February 2025, according to MinterEllison. Law firm Wotton Kearney reported the Full Court found LKA2 “sufficiently revealed materials which might have been reported to Allianz to trigger s40(3).”
That section is in the Insurance Contracts Act 1984 (Cth). It turns a notice of circumstances into an effective claim notification, if the notice is given as soon as reasonably practicable. Lockton said the Court found the insured’s awareness arose when the report was received. The insured therefore could not rely on a later notification for the relevant claims.
HWL Ebsworth Lawyers, which acted for Allianz, said the Trust was liable as a nominal defendant for Knox, so Knox’s knowledge counted as the Trust’s knowledge. The High Court refused special leave to appeal, with costs, in June 2025. Chief Justice Gageler and Justices Gordon and Jagot found the case an unsuitable vehicle for one question and saw too little chance of success on the other.
The Full Court also examined prior known circumstances exclusions, which are common in claims-made policies. Wotton Kearney said a 2:1 majority found the exclusion void under section 52, with Justice Derrington dissenting. Those comments were not needed to decide the appeal.
HWL Ebsworth said the special leave application did not raise the exclusion issue, so those remarks stand until a future judgment. A legal analysis published in August, said uncertainty over these exclusions will likely continue until an appellate court revisits the issue.
Other commentators have focused on practice. Maya Lazarus, claims manager at Probitas Pacific, wrote that brokers should educate clients on the importance of timely notification of circumstances, using real-world examples. Her piece for brokers covers several recent Insurance Contracts Act cases.
An ANZIIF article said a valid notification should be in writing. King & Wood Mallesons said the more detail a notification includes, the more likely insurers are to accept it captures a later claim.
Mills Oakley wrote in September 2025 that the case confirmed the Church could not access cover for many claims of historical sexual abuse at the school. The firm said the ruling matters for charities and not-for-profits.
Lockton said these signals may need to be considered from an insurance perspective “well before a formal claim is received.”
