FAQ's In Respect of Business Interruption Insurance & Coronavirus

What is Business Interruption Insurance?

Business Interruption policies protect the cash and profits of the business.   The aim is for the insured to be paced into the same position that they would have been had the loss not occurred.

What is a test case?

In case law, a test case is a legal action whose purpose is to set a precedent.   Test cases are brought to Court as a means to provide a clearer definition to laws with disputed meaning and/or intent.

Who are the parties involved in the claim?

The FCA and various insurance companies who provided representative policy wordings.

What is a non-damage extension to my policy?

Traditionally, Business Interruption cover is triggered by an event occurring under the Fire and Perils section of the policy.   However, the non-damage extension provides Business Interruption cover for other occurrences such as denial of access, occurrence of notifiable disease and closure by a competent local authority.  The current test case concerns interpretation of these extensions.

My insurance company/broker have said that I don't have a claim.

Your advisor will have acted in accordance with their understanding of the position when you make the enquiry.   This is, however, subject to continuing change in view of the legislation.   You should certainly issue a Letter of Claim to your insurers and begin your case.

 

What is a Letter of Claim?

 

This is a broad outline of your claim and will enable us to begin your case.   We will then contact your insurers.

 

What happens if the test case is decided in favour of the FCA?

If this is the case, the result will be legally binding on the insurers party to the test case.   It will also provide for the interpretation of similar policy wordings and claims.

What is mitigation and how should I be minimising any of my losses?

You're under a Common Law duty to mitigate or minimise any loss that you may suffer.

How do I calculate my losses?

The Test Case will not determine how much is payable but will provide the basis for doing so.   We can help you with calculation of losses.

How do I find out my Business Interruption policy wording if I can't find the documents?

Contact us and we will endeavour to trace the insurers for you?