Authored by Donald Dinnie and Alanna Bollweg.
In late 2025 a U.S. district court provided insight into how courts may interpret “related claims” provisions in liability insurance policies. This matter concerned two separate class actions instituted against a property development and rental management company, who submitted two claims on their claims-made ‘Entity Liability’ insurance policy. The insurer relied on an aggregation clause in the insurance policy to treat the two claims as one claim. This would have meant a single limit of $5 million in total applied, instead of separate limits totalling $10 million, as the policyholder claimed. The court held that the actions, instituted separately in Montana and in Michigan, several years apart, by different complainants, over different immovable properties, were nonetheless related claims and therefore subject to the single policy limit.
Although the class actions involved different plaintiffs, jurisdictions and property developments, they were all rooted in the policyholder’s mandatory rental management programme. Both the Montana and Michigan class actions alleged features such as non‑negotiable agreements, unilateral control by the policyholder, and improper revenue diversion.
The liability insurance policy defined “related claims” as “all Claims for Wrongful Acts based upon, arising from, or in consequence of the same related facts, circumstances, situations, transactions or events or the same or related series of facts, circumstances, situations, transactions or events”. The court found this wording unambiguous and concluded that both actions emerged from similar overarching conduct, resulting in both claims being treated as one claim for policy purposes.
Worldwide, similar aggregation clauses are common. Courts look past surface‑level differences (such as different consumers, patients or locations) and instead examine whether the claims arise from the same underlying conduct or cause. Broad policy wordings – such as claims “arising from”, “consequent on” and “attributable to” one source or original cause – tend to support aggregation into a single limit.
On similar wording and similar facts, a South African court is likely to reach the same conclusion.
Insurers benefit from clear wording. This ruling may encourage insurers in South Africa to further clarify their aggregation and related‑claims definitions to minimise ambiguity and reduce litigation risk.