Articles

"Beware of the "Bermuda Form" Arbitration Provision in a Commercial Liability Insurance Policy"

Articles / February 1, 2014

Cleveland Counsel Chris Bator authored the article, "Beware of the "Bermuda Form" Arbitration Provision in a Commercial Liability Insurance Policy," published in the Bar Journal of the Cleveland Metropolitan Bar Association. The article explains that businesses usually focus on coverages afforded by a specific liability policy and pertinent exclusions, but sometimes other pertinent provisions of a policy can be overlooked. This is especially troublesome for the policyholder if the "Bermuda Form" is involved. This particular provision states that any dispute relating to the policy shall be determined in London, England under the English Arbitration Act of 1996, and that issues will be construed in accordance with internal laws of the state of New York. The typical rule of construction that any ambiguities in the policy are construed against the insurance carrier does not apply. 

 

Bator recommends that businesses review their policies closely to determine if the Bermuda Form arbitration provision is included. If so, business should discuss with their brokers whether the policy can be renewed without the provision. 

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