Non-Property-Damage Business Interruption Cover (‘non-damage BI’ cover) and the FCA’s test-case
On 1 May 2020, the Financial Conduct Authority (FCA) announced its intention to seek clarity and certainty around non-damage BI cover in relation to the coronavirus pandemic.
The FCA initiated a Test Case on behalf of policyholders to determine the interpretation of certain clauses within policies that include non-damage BI. They hoped that this would assist in providing greater clarity to insurers and policyholders alike in the handling of COVID-19 claims.
The Test Case was first considered in the High Court. The High Court Judgment was published on 15 September 2020. This was appealed to the Supreme Court. The Supreme Court Judgment was published on 15 January 2021. The Supreme Court published its Declarations on 14 July 2021.
The Declarations distil the Supreme Court’s Judgment into a Final Order reflecting and summarising the Court’s conclusions. A copy of the Declarations can be found on the Supreme Court website and the FCA’s Business Interruption insurance website.
Please refer to the ‘useful websites’ below for further detail about the Test Case.
For more information about the Test Case, and regular updates from the FCA including the FCA’s Guidance on Proving the Presence of COVID-19 and the FCA’s calculator for this purpose, we recommend the FCA’s dedicated Business Interruption website: https://www.fca.org.uk/firms/business-interruption-insurance.
Register for the latest BI updates from the FCA: www.fca.org.uk/sign-business-interruption-bi-insurance-email-updates
Information for small businesses from the Financial Ombudsman Service: https://sme.financial-ombudsman.org.uk