Can my small business expect a Covid insurance payout after UK supreme court victory?

This is a question that many of our members have been asking us in search of the answers. We asked the insurance expert on our BID Board: Ivan Le Roux, Head of Group Insurance for AO

Are you insured?

Many firms took out business interruption insurance policies to cover them for unexpected events that caused them to stop trading but then found that insurance companies rejected claims for losses resulting from lockdowns. Here’s what Ivan has to say on the matter:

Supreme Court rules in favour of policyholders in FCA BI test case

The Supreme Court has in the last week released its much-anticipated landmark judgment in the FCA Business Interruption test case.   This is positive news for those policyholders who have business interruption extensions, suggesting that there could be cover for losses arising from national COVID-19 restrictions under certain types of policy wording, namely:

  • Wide-vicinity disease clauses where the insured would generally be covered for losses when it could be evidenced that there was an occurrence of COVID-19 within a stated vicinity (usually 25 miles) of insured premises.
  • ‘Hybrid’ disease clauses where policies would respond where the insured was able to evidence restrictions imposed on premises as a result of COVID-19.
  • Non-Damage Denial of Access clauses where there was no mention of a vicinity to insured premises.

Whilst this is undoubtedly a positive decision for many policyholders, indemnity and the level of policy coverage is very much dependent on specific policy wording; this should be thoroughly checked against the Supreme Court (and High Court) rulings (Click here)

Ivan le Roux has over 15 years experience as a in-house insurance buyer and property management specialising in building Society, financial advice, estate agency and survey and valuations risk across 750 retail locations in the UK, Channel Islands and New Zealand. He was recently appointed Head of Group Insurance at AO.

For our Skipton BID Levy Payers seeking further business advice on a range of COVID-related issues and business development, please visit the website for Federation of Small Businesses.