Small firms are cheering a Supreme Court ruling that appears set to force insurers to pay out on disputed coronavirus business interruption claims worth at least £1.2bn.
Judges were asked to set the parameters for valid claims from various policies following a test case brought by the Financial Conduct Authority (FCA) with the support of eight insurance companies last summer.
The High Court judgment, handed down in September, was widely seen as supportive for the bulk of the estimated 370,000 companies said to be affected by the dispute.
A broad range of firms including pubs, cafes, wedding planners and beauty parlours argued they faced ruin when they were turned down by insurers for business interruption policy claims on losses caused by the first national COVID-19 lockdown.
Six of the world's largest commercial insurers Hiscox, RSA, QBE, Argenta, Arch and MS Amlin, told the Supreme Court in an appeal that many business interruption policies did not cover widespread disruption.
The legal process was fast-tracked to the highest court in England and Wales which rejected the insurers' arguments and said it had "substantially allowed" an appeal brought by the FCA and action group to clarify the position.
A key part of the case related to "prevention of access clauses" - which are triggered by "public authority intervention preventing access to, or use of, the business premises".
Summarising the decision, Lord Hamblen said the High Court's interpretation was "too narrow".
The judge said: "An instruction given by a public authority may amount to a 'restriction imposed' if it carries the imminent threat of legal compulsion or is in mandatory and clear terms and indicates that compliance is required without recourse to legal powers."
The Hiscox Action Group, representing thousands of claimants, hailed the ruling as a "massive boost" for UK businesses.
It claimed a "full victory" and added: "The decision has been unanimous against Hiscox et al."
Hiscox shares were trading more than 4% down after the judgment.
It is unclear whether the decision will prompt a flood of further claims.
https://news.google.com/__i/rss/rd/articles/CBMieGh0dHBzOi8vbmV3cy5za3kuY29tL3N0b3J5L2NvdmlkLTE5LXN1cHJlbWUtY291cnQtYmFja3Mtc21hbGwtZmlybXMtb3Zlci1idXNpbmVzcy1pbnRlcnJ1cHRpb24taW5zdXJhbmNlLWNsYWltcy0xMjE4ODMyMtIBAA?oc=5
2021-01-15 09:53:27Z
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