Can you Claim Through Your Business Interruption Insurance if you Have Been Adversely Affected by Covid-19?
Last week, The High Court handed down its judgment in the Financial Conduct Authority’s (FCA)’s business interruption insurance test case.
The Court found in favour of the arguments advanced for policyholders by the FCA on the majority of the key issues.
Many policyholders whose businesses were affected by the Covid-19 pandemic suffered significant losses, resulting in large numbers of claims under business interruption (BI) policies.
Most SME policies are focused on property damage and only have basic cover for BI as a consequence of property damage. But some policies also cover for BI from other causes, in particular infectious or notifiable diseases (‘disease clauses’) and non-damage denial of access and public authority closures or restrictions (‘denial of access clauses’). In some cases, insurers have accepted liability under these policies. In other cases, insurers have disputed liability while policyholders considered that it existed, leading to widespread concern about the lack of clarity and certainty.
What the Judgement Means for Policyholders
Although the judgment will bring welcome news for many policyholders, each policy needs to be considered against the detailed judgment to work out what it means for that policy. Policyholders with affected claims can expect to hear from their insurer within the next 7 days.
It is possible that the judgment will be appealed, but any appeal does not preclude policyholders seeking to settle their claims with their insurer before the outcome of any appeal is known.
For full details, please see https://www.fca.org.uk/news/press-releases/result-fca-business-interruption-test-case
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