update business insurance

Back in May, it was reported that the insurance industry had been under increasing pressure for their refusal to pay out Business Interruption Insurance claims to companies that have been devastated by the coronavirus pandemic. By July, in an update, a consolidated list of the disputed business interruption cases was included in a test case instigated by the Financial Conduct Authority. The court action was brought about in order to determine whether the pandemic should prompt payments to policyholders.

The judgement update

Fast forward to September and the high court has now ruled in favour of business policyholders and that in the context of COVID-19, many are in fact eligible for insurance payments under the terms of their business interruption policies.

The court has ruled that payouts were prompted under “non-damage” clauses which included;

  • diseases and,
  • denial of access to business premises.

Policyholders will have to carefully read the 160-page judgement to see how their policy wording compares to the principles that have now been confirmed by the court.

Partner and global head of insurance disputes at the FCA’s law firm Herbert Smith Freehills, Paul Lewis, commented, “This is a really significant judgment. It brings guidance to how business interruption insurance wordings should operate in the context of the Covid-19 pandemic, which has had such a devastating effect on businesses across the country. The decision should bring welcome news to a significant number of policyholders.”

How many policyholders will be affected?

370,000 business policyholders could be affected by this, according to FCA estimates.

What should home improvement companies do if their claim has been declined?

If your claim has been rejected by your insurer, but you believe your Business Interruption Insurance does provide cover for pandemics, please contact us for guidance. At QASSS, we can help with the claims process and can arrange access for home improvement companies to an expert Loss Adjusting service, should you need independent advice regarding complex, major or difficult claims.

To find out more about this service, contact Scott Robinson our Commercial Director or call 0161 676 0919.


Photo by Andrea Piacquadio from Pexels