On 1 May 2020, the Financial Conduct Authority (FCA) announced that it intended to obtain a court declaration to resolve uncertainty around whether certain non-damage business interruption insurance policies provided cover for losses arising as a result of COVID-19.
The issues relating to the impact of COVID-19 on business interruption policies are complex.
Following consultations with Insurers, policyholders and Insurance Brokers, the FCA has chosen a selection of policy wordings which it considers is representative of the most important issues in the dispute between policyholders and Insurers.
The Insurers involved are:
- Arch Insurance UK Ltd
- Argenta Syndicate Management Ltd
- Ecclesiastical Insurance Office Plc
- Hiscox Insurance Company Ltd
- MS Amlin Underwriting Ltd
- QBE UK Ltd
- Royal & Sun Alliance Insurance Plc
- Zurich Insurance Plc
The Declaratory Judgement will apply to ALL Insurers and not limited to those mentioned above.
The expected timetable of events going forward is for the hearing of the Test Case to start on 20th July 2020 and regular updates are available on the FCA website: www.fca.org.uk/publications/finalised-guidance/business-interruption-insurance-test-case
Alternatively, please use an online search for ‘FCA Business Interruption Test Case’ to see the latest news.
Please rest assured we are keeping a watchful eye on events and if you have any concerns whatsoever, please do not hesitate to contact us.
Any views or opinions expressed above are for guidance only and are expressed in generic terms. They are not intended as a substitute for readers taking appropriate professional advice relevant to individual circumstances. We would always encourage readers to seek professional advice.