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Reinsurance contracts follow the pattern of liability insurance, in that the cause of action
accrues when the underlying liability is ascertained by agreement, by award or by
judgment (Daugava v Henderson 1934 and Halvanon v Co. de Seg. Do Estado de Sao
Paulo 1995). In excess of loss reinsurance, for time to start running all the facts
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necessary to establish a claim must be in existence. So the breaching of the excess point
is determined by reference to the date the reinsured’s liability to pay the relevant inwards
claim is established (even under a variable excess of loss when the final excess point
has not then been ascertained) (North Atlantic v Bishopsgate 1998).
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