Business interruption takes the spotlight

COVID-19 was destined to be a hardship for many businesses. Now, one of the biggest test cases ever brought by the FCA has head to the Supreme Court.

The hearing is expected to last four days and decided on whether insurers should pay out on business interruption claims related to the coronavirus pandemic.

A heap of insurers claim that policies were never meant to cover such an emergency. Eight insurance firms were involved in the original test case announced by the FCA in June 2020.

According to GlobalData’s 2020 UK SME Insurance Survey, 13.3% of UK SMEs have cancelled their business interruption insurance, with the leading reason (26.3%) being that their policy did not provide the level of cover they thought they needed.

Business interruption takes the spotlight.

COVID-19 was destined to be a hardship for many
businesses. Now, one of the biggest test cases ever
brought by the FCA has head to the Supreme Court.

The hearing is expected to last four days and decided on whether insurers should pay out on business interruption claims related to the coronavirus pandemic.

A heap of insurers claim that policies were never meant to cover such an emergency. Eight insurance firms were involved in the original test case announced by the FCA in June 2020.

According to GlobalData’s 2020 UK SME Insurance Survey, 13.3% of UK SMEs have cancelled their business interruption insurance, with the leading reason (26.3%) being that their policy did not provide the level of cover they thought they needed.

Business interruption
takes the spotlight.

COVID-19 was destined to
be a hardship for many businesses.
Now, one of the biggest test cases ever brought by the FCA has head to the Supreme Court.

The hearing is expected to last four days and decided on whether insurers should pay out on business interruption claims related to the coronavirus pandemic.

A heap of insurers claim that policies were never meant to cover such an emergency. Eight insurance firms were involved in the original test case announced by the FCA in June 2020.

According to GlobalData’s 2020 UK SME Insurance Survey, 13.3% of UK SMEs have cancelled their business interruption insurance, with the leading reason (26.3%) being that their policy did not provide the level of cover they thought they needed.

Many SMEs would have assumed that losses due to the pandemic would be covered in their policies, but many have found otherwise. Rejected COVID-19 claims and cost-cutting were the joint second most common factor for cancelling policies, with each cited by 22.9% of SMEs.

The impact of coronavirus and the resulting lockdown cannot be denied. The Office for National Statistics (ONS) reported that the first national lockdown, which began in mid-March and ended in mid-June 2020, contracted the UK’s GDP by 20.4%, the largest recorded fall since the ONS started collecting data in 1997.

All eyes towards the Supreme Court then as its result could affect around 700 types of policies and just under 400,000 policyholders. It’s a £1.2bn battle that could see no winners.

In this issue, we look at other consequences of recent times. Communication breakdowns, SMEs and cyber insurance, workforces, and mental health. Insurance has many a hurdle to get over in 2020.

Patrick Brusnahan, Editor