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7th Circuit affirms Aon owed no notice duty to non-client
The dispute also hinged on timing, with the court finding the claims were filed after a two-year Illinois window for suits over insurance placement or notice.
A two-decade recovery dispute over insurance notice obligations ended with the US Court of Appeals for the Seventh Circuit affirming that Aon Risk Services owed no duty to a non-client seeking to reach coverage. Insurance Business reports the ruling, dated August 13, 2026, held that Aon’s obligations ran to its own client, not to outsiders trying to enforce notice provisions tied to policies it arranged for another broker.
The underlying case traced back to the 1990s, when Aon helped insurance broker Stirling Cooke Brown Holdings (SCB) build a professional liability program. Gulf Insurance Company wrote the primary $15 million layer, while four “Excess Carriers” sat above it, and the policies required SCB to provide carriers written notice of any claim as soon as practicable.
After a related reinsurance effort caused Clarendon America Insurance Company losses, Clarendon brought claims against Raydon Underwriting Management Company (Raydon), an SCB subsidiary. SCB sent some claims to Aon, and Aon forwarded two to Gulf but not to the Excess Carriers, which became the basis for former Clarendon shareholders to argue Aon breached agreements and was professionally negligent by failing to notify every carrier.
The court rejected the plaintiffs’ claims on multiple grounds, including that Clarendon was not a third-party beneficiary of the agreements and that Illinois law does not treat a similarly situated non-insured as a protected party under a broker’s duty. It also found the claims were too late, citing an Illinois two-year limit for suits against an insurance producer over placement or notice and noting the plaintiffs were on inquiry notice by 2012 but filed in 2019.