The Supreme Court has set a date for the appeal of the Financial Conduct Authority’s test case on business interruption insurance relating to the coronavirus pandemic lockdown – a case which could impact thousands of businesses and their insurers.
The four-day hearing will start on November 16, according to a court statement obtained by Reuters.
The FCA launched the test case to determine whether a representative sample of eight insurance companies with 21 policy wordings would have to pay out claims to businesses that were forced to close due to the COVID-19 lockdown in March.
The High Court analysed three types of policy wordings that cover business interruption, namely “when insured premises cannot be accessed because of public authority restrictions”, “in the event of a notifiable disease within a specified radius”, and a combination of the two.
The judges mostly ruled in favour of the policyholders on September 15, opening the door for an appeal.
Six insurers – Arch Insurance, Argenta, Hiscox, MS Amlin, RSA, and QBE UK – and a policyholder action group have joined the FCA on the appeal, which seeks to clarify whether the policy wordings cover business interruption caused by the nationwide coronavirus lockdown last March.
A decision on the wordings could potentially impact 700 types of policies, 60 insurers, and 370,000 policyholders, resulting in billions in claims.