“The Supreme Court’s landmark ruling today on the FCA's business interruption (BI) insurance case for Covid-19 claims is one of the most important legal issues of the last decade. Affected policyholders will welcome the ruling to unanimously dismiss insurers’ appeals and to substantially allow all four of the FCA’s appeals in favour of policyholders.”
Julia Graham, Airmic’s deputy CEO and technical director, commented:
“This morning’s decision by the Supreme Court represents positive news for hundreds of thousands of commercial insurance buyers across the UK. The Supreme Court’s ruling completes the legal process for impacted policies and means that many more claims can now be processed and paid out to businesses that are already feeling the strain during the pandemic period.
“To provide some scale to the significance of this morning’s Supreme Court ruling, the FCA has estimated that some 370,000 policyholders would be affected by today’s Supreme Court decision, paving the way for up to £1.2bn in BI claims payments, across 700 policy types, from 60 insurers.”
Mr Ludlow added:
“Insurance buyers have faced a harsh insurance market in 2020-2021. The rocky business conditions felt by many during the pandemic and the resultant economic downturn have been met with hard insurance market pricing during recent renewals discussions.
“Many of the insurance buyers affected by the FCA’s BI case are long-term insurance partners; now that many more of these BI claims are to be paid, it will be to the benefit of enduring relationships between carriers and their policyholders, which in many cases were already strained not just by this case but by recent market conditions. Today’s news should be viewed within that broader context.”
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