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First Advised Clause

First Advised Clause

Definition

First Advised Clause —

Used in the 1960s in certain global slip excess-of-loss reinsurance treaties written by underwriters participating in the Lloyd's of London marketplace, the clause provided as follows.

[t]his Contract does not cover any claim or claims arising from a common cause, which are not first advised during the period of this Contract.

It is part of a larger common cause coverage meant to allow the cedent to cumulate losses ("occurrences") and cede them to the excess-of-loss treaty when the individual losses all arise out of a larger common cause (occurrences during the term of the contract that are the "probable common cause or causes" of more than one claim).

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