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Cyber
FCA TEST CASE – COVID-19 Losses – Supreme Court Decision announced today.
The Supreme Court judgment in the FCA Business Interruption Test Case was published today. The full judgment together with a copy of the FCA’s press release is available here.
In concert with our Network provider Marsh and specialist Law Firm Fenchurch Law, we are reviewing the content of the judgment in detail. However, the key message is that the Supreme Court substantially allowed the appeal of the FCA on behalf of policyholders and dismissed the appeal brought by insurers. Notably finding the following:
- Notifiable Disease Clauses – while the Supreme Court took a different approach to the High Court, it confirmed that all the disease clauses before the Court were triggered;
- Prevention of Access / Hybrid Clauses – cover under these clauses still faces challenges but may be triggered more readily. No requirement for a legislative step ordering closure and potential cover for loss of access to part of premises;
- Trends Clauses – the Supreme Court was clear that trends clauses can only take into account factors wholly unrelated to COVID-19 and rejected the “wide area damage” arguments of insurers;
- Orient Express – the Supreme Court determined that the Orient Express case was wrongly decided and that it should be overruled. This decision therefore has positive consequences for insureds beyond the scope of COVID-19 claims.
Next steps
We expect to be able to issue a further communication next week, to provide more detail about the key findings in the judgment and we will let you have further details when we are able. Please speak with your Account Executive if you have any questions or concerns regaring the implications following this judgement.
10 COVID-19 related insurance tips for SME’s
Over the last few months, we have released a number of updates relating to the insurance implications of the COVID-19 pandemic. Now that we are back in Lockdown 2, I thought it timely to bring an excellent summary to your attention that our industry body BIBA have released in conjunction with the CBI and the ABI. It’s a very concise and informative document which highlights 10 keys issues for anyone involved in running a business. I would encourage you to follow the link HERE. Please make contact with us if you need to discuss your own circumstances.
FCA Test Case
The FCA have taken their next step to seek legal clarity on Business Interruption Insurance following the COVID-19 crisis.
Why are the FCA taking this step?
Broadly, the result of the test case will be legally binding on the insurers that are party to the case and it will also provide a persuasive case for similarly worded policies.
If you would like to read a summary report, please click HERE for an article we have copied on Linkedin.
For a more in=depth report including the particulars of the claim and some policy wording examples from the FCA website please click HERE
Not Opening. This is important?
If you CAN re-open but have decided NOT to do so for your own reasons, we would urge you to check with us as your insurer may consider the “normal” unoccupancy conditions to apply (and the limited cover that this triggers). In the event this is the case, we will need to advise insurers and negotiate revised terms based on your individual circumstances.
