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When does indemnity arise? Accrual of a cause of action for breach of contract under a property damage insurance policy

Globe Church Incorporated v Allianz Australia Insurance Ltd [2019] NSWCA 27

In a split decision delivered on 26 February 2019, the NSW Court of Appeal found that a cause of action for breach of a promise to indemnify under an insurance policy accrues at the time of the insurable event – even where a claim has not been made or has not been assessed.

The majority of the Court of Appeal held that the limitation period for property damage insureds under policies promising to ‘indemnify’ for loss begins to run from the date of damage rather than at some later time when indemnity is denied or taken to have been refused.

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