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Swiss ruling focuses attention on liability claim wording


The interpretation of an insurance contract exclusion clause wording by the Swiss Federal Supreme Court has focused attention on claims arising from damages caused by a "knowingly" committed violation of law.

In the case in Switzerland the claimant held that "knowingly" is supposed to mean "direct intent", the defendant was of the opinion that the exclusion clause only required knowledge of the violated law, regardless of intent on the insured's part. The Court did not completely agree with either party.

As the interpretation of the word "knowingly" remained disputed by the parties, the Court had to rule on this question.

The Court held that in the context of the clause at hand, "knowingly" required that the insured had knowledge of the law or regulation which was violated and made a wilful decision to act anyway. This is the only decision known in Switzerland that deals with the interpretation of the word "knowingly" in exclusion clauses.

Under the policy exclusion clause in the Swiss case, the insurer denied coverage for "claims arising from damages caused by the intentional commission of felonies and misdemeanours or by a knowingly committed violation of law, of a governmental regulation or a contractual obligation".

The parties' dispute focused on the interpretation of the clause's second option, the exclusion of "a knowingly committed violation of law, of a governmental regulation or a contractual obligation". More precisely, the parties had differing views on the meaning of the word "knowingly".

A Professional indemnity exclusion clause is an amendment to the standard policy terms and conditions, which removes, limits or changes those standard term.

The policy usually contains specific clauses that exclude coverage for occurrences or claims that are the result of the insured having acted with a degree of intent. These clauses typically exclude coverage for acts or omissions of the insured which are committed "wilfully", "intentionally" or "knowingly".

In law, the word “knowingly” means consciously or with knowledge or complete understanding of the facts or circumstances.

This case highlights the complicated legal arguments that can arise when interpreting insurance exclusions. W Denis arrange specialist liability insurance for businesses of all sizes. To discuss further please contact or

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