On 1 May 2020 the Financial Conduct Authority (FCA) announced that
it intended ‘to seek legal clarity on business interruption
insurance to resolve doubt for businesses who are facing
uncertainty on their claims.’
The High Court has today provided its ruling. It found in favour
of the majority of the arguments put forward by the FCA on behalf
of policyholders.
Commenting on the ruling, , Chair of the Treasury Committee, said:
“This ruling will provide hope for many businesses that have
been put through the mill whilst seeking insurance pay-outs.
“For some though, the devil will be in the detail of this
judgement. Others may be caught up in any appeals. It is to the
credit of the FCA that they have initiated and driven this
approach.
“It’s now vital that all those who should be paid receive
these payments as soon as possible. The Treasury Committee will
continue to monitor developments closely and press for further
progress.”
--Ends--
Notes to Editors
- The result of the FCA’s Business Interruption test case are
on the FCA’s website here.
- The FCA announced on 1 May 2020 that it would seek legal
clarity on business interruption insurance. Commenting at the
time, Mr Stride said:
“The uncertainty surrounding these insurance claims has been
life-sapping for many businesses and there is a risk here of
damage to the insurance sector’s reputation.
"With some businesses struggling day to day for survival, the
Treasury Committee has called for clarity.
"Today’s steps by the FCA to help remove uncertainty for all
parties around business interruption insurance are therefore
extremely welcome.
“It will be critical though that the court process is
expedited as rapidly as possible so that any resulting additional
claim payments can be realised at the earliest opportunity. The
Committee will be pressing for rapid progress.
“Those who should be paid, should be paid as soon as
possible."
