Top broker Marsh, advocating for clients whose coronavirus-related claims have been rejected under their business interruption (BI) insurance, has submitted information to the Financial Conduct Authority (FCA) as part of the regulator’s High Court test case consultation.
The submission, which Marsh said included a range of issues that are relevant to most clients’ claims as well as a number of specific wordings, used data from the company’s Marsh Commercial unit.
“Given the number of policy wordings already submitted to the FCA through the insurer consultation and most likely through the intermediary and policyholder consultation, we deliberately chose a select number of policies that either impacted large numbers of clients, had wide impact to many other clients due to commonality of issues, or contained different and specific wordings which we believe it would be helpful for policyholders to be included,” stated Marsh in an update.
“There is of course no guarantee that the FCA will include these wordings within the select number of wordings they take forward in their test case, but we have advocated strongly for their inclusion. Marsh remains committed to supporting all our clients’ claims.”
The watchdog’s goal is to obtain court declarations aimed at resolving contractual uncertainty in selected BI insurance policies. The FCA previously said it will put forward policyholders’ arguments to their best advantage as it acts in the public interest.
Earlier this month, the regulator explained: “We are aiming to obtain legal guidance in this way more quickly and at a lower cost to policyholders than would be the case if they took their own court actions.
“The FCA recognises that many claims will already be the subject of negotiation or other dispute resolution processes. This proposed action is not intended to impact this normal claims process. It is designed to assist policyholders, and particularly SMEs, whose claims are being refused when they think the firm should respond.”
According to the watchdog, the result of the test case will be legally binding on the insurers that are parties to the test case in respect of the representative sample considered, and will also provide persuasive guidance for the interpretation of similar policy wordings and claims.
