Ruling in business interruption test cases expected on Tuesday

Rulings in the High Court test cases held to determine if insurers should pay out business interruption claims related to Covid-19 will be announced on Tuesday (15 September) at 10.30am.

The cases, heard in July, were brought by the Financial Conduct Authority (FCA), which looked to the court to provide clarity for business owners and the insurance industry. A hearing took place over eight days before Lord Justice Flaux and Mr Justice Butcher.

The FCA reviewed 500 relevant policies and identified a sample of 17 wordings that capture "the majority" of issues under dispute, which were considered by the court.

Eight insurers participated in the action, but more will be affected as they have used similar wording in their policies. The eight insurers that took part are: Arch Insurance (UK), Argenta Syndicate Management, Ecclesiastical Insurance Office, Hiscox, MS Amlin Underwriting, QBE UK, Royal & Sun Alliance and Zurich.

Many companies have had business interruption claims denied, with insurers claiming the Covid-19 pandemic was not covered in policies.

The FCA has previously said that in "the majority" of cases it does not anticipate businesses will be covered, but that these test cases will examine a limited number of policies where arguments for claims can be put forward.

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