BUSINESS INTERRUPTION CLAIM

BUSINESS INTERRUPTION CLAIM

Has your business been affected by Covid? Have you been unable to operate because of the Government Announcements, but your insurance company is refusing to pay out on a legitimate claim? If your business is one of them Satchell Moran Solicitors can assist you.   

Many prudent business owners will ensure that their businesS insurance covers them should their company have to close due to no fault of their own. This type of insurance is called “Business Interruption Insurance” and is offered by many insurers for several different reasons when the business is unable to trade. If your policy is extended to include an occurrence of any human infectious or human contagious disease or has a clause in relation to the denial of access to your premises, you may be able to claim. Unsure, please contact one of our experts at Satchell Moran who will be able to review your policy wording on your behalf. Where there is business interruption insurance in place it would pay out for financial losses incurred that are a “direct consequence of a business interruption”, such as loss of revenue, loss of rental income, and additional staff costs.

COVID 19 PANDEMIC

Many insurers are refusing to pay out to policyholders despite the business owners having the appropriate cover. Each policy will need to be reviewed for the policy wording, specifically in relation to what is covered for the occurrence of a human infectious disease or insured peril. Often the wording to these policies is unclear with the insurance company using this to their advance and refusing to meet their obligations under the policy. 

There was such growing concern within the insurance industry and that UK businesses would be left without the ability to trade; the Financial Conduct Authority stepped in asking the courts to resolve the issues around the Covid 19 pandemic and if this is covered by the Business Interruption Policies. The FCA Test Case resulted in the Supreme Court handing down a favourable judgement for the Policyholders in January 2021. It is important to note the following limitations within the judgement: -

  1. 12 out of 21 sample wordings were held to provide cover. However, the FCA have estimated that there are 700 types of business interruption policies which will include significant variations to the sample wording provided.
  2. Due to these variations, it is likely that insurers will contest the cover. The insurers will make legal distinctions which most policy holders will not be able to deal with, without the help of a Solicitor.
  3. It was not the intention of the FCA for the Test Case to incorporate all possible disputes and therefore does not determine the policyholder’s individual claims.
  4. The Test Case does not include non-damage wording and therefore only resolves limited questions to the extent of the cover provided.

If you think this applies to your insurance policy please contact a member of our Financial Mis-selling team on 0151 268 8282 or email us on info@satchellmoransolicitors.com, or use the contact form below.

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