Battle lines have been drawn between business and the insurers with the issue on 9th June 2020 of legal proceedings in the High Court by the The Financial Conduct Authority (FCA) against 8 major UK insurers.
The principal aim of the test case is to establish whether or not certain business interruption (BI) policy wordings cover losses caused by the Covid-19 pandemic:
"The coronavirus pandemic has led to widespread disruption and business closures resulting in substantial financial loss. Many customers have made claims for these losses under their BI insurance policies. There has been widespread concern about the lack of clarity and certainty for some customers making these claims, and the basis on which some firms are making decisions in relation to claims." FCA
According to The Association of British Insurers' (ABI) website:
The FCA has selected several BI policy wordings to go before the Court to issue a legally binding declaration on their meaning and applicability to Covid-19 claims. The Particulars of Claim against the insurers is set out in full on the FCA's website.
The published test case timetable is as follows:
|9th June||FCA started claim in the High Court|
|16th June||Case management conference, at which the court will be invited to fix the timetable for the case and other procedural matters|
|23rd une||Insurers file Defences|
|c.26th June||Further case management conference|
|3rd July||FCA files Reply|
|1st half July||Skeleton arguments and replies served|
|2nd half July||5-10 day court hearing|
It is important to note that the FCA's test case:
On 17th June, the FCA issued in a guidance note setting out its expectations for insurers and insurance intermediaries when handling claims and complaints for business interruption policies during the test case brought by the FCA.
Amongst other things, the FCA requires that:
Policyholders should be provided with:
By the publications team at: Contracts-Direct.com
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