III IC-74 key terms

Money a court orders a defendant to pay to put an injured party back in the position they would have occupied had the harm not occurred, covering both economic and non-economic losses.

An award added on top of compensation to punish especially reckless or intentional wrongdoing and deter similar conduct; many liability policies exclude or restrict cover for them.

Compensation for harm that cannot be precisely calculated in money, such as pain, suffering, loss of amenity, or emotional distress; often the largest element of a bodily injury claim.

Compensation for losses that can be itemised and proved with receipts or records, such as medical bills, repair costs, or lost earnings.

Failure to exercise the degree of care a reasonable person would use in the same circumstances, which causes harm; the core basis of most third-party liability claims.

The legal obligation to avoid acts or omissions that could foreseeably harm others; the first element a claimant must establish in a negligence action.

A defendant's failure to meet the standard of care owed to a claimant, judged against what a reasonable person or professional would have done.

The link between a defendant's conduct and the harm suffered, requiring the loss to be a foreseeable and not too remote consequence of that conduct.

Liability imposed without proof of fault, for example for defective products or abnormally dangerous activities; defences that rely on reasonable care do not help the defendant.

Legal responsibility of one party for the acts of another, most commonly an employer for employees acting in the course of their employment.

The scope of activities an employee is authorised to perform; acts within it can make the employer vicariously liable, while a deliberate detour for personal reasons usually falls outside it.

A rule allowing a claimant to recover the full judgment from any one of multiple responsible defendants, leaving that defendant to seek contributions from the others.

The right of one liable party to recover a share of the damages from another party who also caused the same loss.

Cover protecting the insured against claims brought by someone outside the policy who was injured or whose property was damaged by the insured's activities.

Insurance that pays the insured for its own loss, such as property damage, as distinct from cover that responds to claims made by others.

Physical harm, sickness, or disease suffered by a person, including death resulting from it; a defined trigger for most liability policies.

In liability policies, harm to reputation or rights rather than the body, such as libel, slander, invasion of privacy, or false arrest.

A defined cover for harm caused by the insured's advertising, such as libel, slander, copyright infringement in an advertisement, or unfair competition.

Physical injury to tangible property, including loss of use of property that has been damaged or is no longer fit for its purpose.

An accident, event, or continuous exposure that causes injury or damage during the policy period; the trigger used by occurrence-basis liability policies.

A liability policy that responds to claims first made against the insured during the policy period, regardless of when the underlying act happened, subject to any retroactive date.

The date in a claims-made policy before which acts giving rise to a claim are not covered, even if the claim itself is made during the policy period.

An optional or automatic extension after a claims-made policy ends, during which claims for acts already covered can still be notified, usually for a stated extra premium.

The maximum amount an insurer will pay for a covered claim, whether stated per occurrence, per claim, or in aggregate across the policy period.

The total amount an insurer will pay for all covered claims during a policy period, capping exposure on top of any per-occurrence limit.

The maximum the insurer pays for any single occurrence or claim, applied separately to each event within the overall aggregate.

A stated amount the insured must pay toward each loss before the liability policy responds, functioning like a deductible but usually with conditions attached.

The portion of each covered loss the insured bears before the insurer pays, typically a fixed sum or percentage stated in the policy schedule.

The clause in a policy that states the core promise to indemnify, identifying the perils, persons, and losses that fall within the cover.

A policy provision that removes specified losses, activities, or persons from the cover granted by the insuring agreement.

Policy terms that set out obligations the insured must meet, such as prompt notification, cooperation, and payment of premium, as a precondition of cover.

The insurer's obligation to fund the legal defence of a claim that potentially falls within the policy, often broader than the duty to pay damages.

The insurer's obligation to pay covered damages on behalf of the insured once liability is established, distinct from its obligation to fund the defence.

Legal fees and expenses incurred in defending a claim; policies differ on whether these sit inside or outside the limit of liability.

A provision removing cover for harm the insured deliberately caused or expected, since liability insurance is not intended to protect against chosen wrongdoing.

Liability arising from injury or damage caused by goods the insured manufactured, sold, or supplied, often triggered by a defect in design, manufacture, or warning.

Liability exposure for harm caused by the insured's work after it has been finished and handed over, typically covered separately from work in progress.

Cover for claims arising from the insured's professional services, including negligent advice, errors, and omissions that cause financial or other loss to clients.

A form of professional liability cover protecting against claims that the insured's mistakes or failures to act caused a client financial loss.

Cover for claims by employees for injury or disease arising out of their employment, often compulsory and separate from public liability cover.