Lockton has told organisations with claims-made cover that a complaint, an internal investigation or a safeguarding report may already be an insurance event, and it is using the Knox Grammar coverage fight to make the point. In May 2004, a private investigator handed the Sydney school's headmaster a report into abuse allegations. Nobody passed it to the insurer, and two decades and three courts later that silence has cost the Uniting Church access to cover for much of the historical abuse litigation that followed.
The broker's white paper on the lessons of UCA v Allianz was written by Damian Burley, its client manager for health and community services, with input from its claims and health and community specialists. Its argument is that for anyone holding claims-made cover, the insurance clock can start ticking well before a lawyer's letter lands, and many organisations don't realise it.
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Between 31 March 1999 and 31 March 2011, Allianz, and before it Mercantile Mutual, wrote successive professional indemnity policies for the Uniting Church in Australia. The insureds included the Uniting Church in Australia Property Trust (NSW) and Knox. The program was placed by Marsh and, from December 2008, by Willis, according to the first-instance judgment.
The investigator's report, known in the litigation as LKA2, reached Knox's then headmaster on 7 May 2004. Bulk notifications of potential abuse claims did not start reaching Allianz until 2009. The insurer paid claims for several years, then from May 2014 declined or reserved its position after learning of LKA2.
The fight turned on section 40(3) of the Insurance Contracts Act 1984. It lets a claim made after a policy expires attach to that policy, as long as the insured told the insurer about facts that might give rise to a claim as soon as reasonably practicable after becoming aware of them. Notify promptly and the later claim is caught. Notify late and it can fall between policies.
In March 2023, Justice Lee sided with the Property Trust. He found the church's structure meant Knox's knowledge could not be pinned on the Trust, which on his reasoning did not know the relevant facts until around 2009.
The Full Federal Court took a different view. In February 2025, Justices Sarah Derrington, Craig Colvin and Timothy McEvoy allowed Allianz's appeal. Justice Derrington held that by claiming under the policies on the school's behalf, the Trust was fixed with Knox's knowledge. Awareness therefore dated from 2004, not 2009, and the later notifications came too late for the relevant claims. The High Court refused the Trust special leave to appeal, with costs, on 17 June 2025.
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The uncomfortable detail for risk managers is that the church had safeguards in place. Justice Derrington pointed to its internal reporting procedures, its guidelines on harassment and abuse, and its pre-renewal insurance sweeps as evidence that it understood each insured entity had to surface potential claims so they could be notified. The machinery was there. The information still did not travel.
That gap, between what a school, clinic or business unit knows and what actually reaches the insurance function, is where Lockton's paper spends most of its time. It looks at how knowledge moves around large and federated organisations, why the timing and detail of a notification matter, and how operational risk information should feed insurance decisions. It also sets out a process to identify, escalate, review and document potential circumstances. The intended audience runs from risk and insurance managers and general counsel to compliance, safeguarding and complaints teams and the executive floor.
For brokers, the case doubles as a script for the renewal meeting. Clients with sprawling structures, such as church bodies, school networks, health and community providers and franchise groups, need to be asked more than "any claims this year?" The better question is what complaints, investigations or reports anyone in the group has received, and who else knows about them. Brokers working the professional risks book will recognise the gap.
Allianz also leaned on a prior known circumstances exclusion, a standard feature of PI and D&O wordings. All three judges agreed it applied on its terms. But Justices Colvin and McEvoy went further and said the exclusion was void under section 52 of the Act, which stops parties contracting out of the legislation. Justice Derrington disagreed.
Because Allianz had already won on notification, those views were not needed to decide the appeal, and the special leave bid did not put them before the High Court. That leaves underwriters with a 2:1 appellate signal against one of the most common exclusions in the market and no binding answer either way. The point is likely to be tested again, and a soft market may give insureds more room to push back on wordings.
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None of the practical lessons is new, but the Knox case shows what ignoring them can cost. Put notifications in writing. Include as much as is known: names, dates, the nature of the allegation and the likely scale, because a thin notification is easier for an insurer to argue does not capture a later claim. Run insurance sweeps that reach the people who actually receive complaints, not just the people who sign the renewal. And when in doubt, notify. A notification of circumstances is a small administrative cost next to discovering, years later, that the trigger was sitting in a filing cabinet.
For not-for-profits and schools, where historical claims can surface decades after the conduct, the Knox timeline is the warning: report in 2004, notifications in 2009, declinature in 2014, final word from the courts in 2025.
