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Insurance Scandal: Help for agents in Business Interruption saga

New guidance has been issued in a bid to allow agents to get the insurance payouts they expect from the Business Interruption policies.

A Supreme Court ruling earlier this year found in favour of policy holders and against insurers, who claimed that most Business Interruption policies did not include Coronavirus.

However, since the Supreme Court ruling many agents have received standard ‘brush off’ letters, claiming the policies did not entitle the firms to any money - despite the legal judgement.


Now the Financial Conduct Authority has issued guidance intended to “help ensure that the process of proving the presence of Covid-19 is made as simple as possible for eligible policyholders and enable those policyholders to receive claim payments as early as possible.”

The FCA says it’s received many complaints that insurers were taking a narrow view of whether their BI policy wordings would provide cover in response to Covid-19, despite the test case which ended up with the Supreme Court’s ruling. 

Now the authority says its guidance should ensure all outstanding cases are resolved by January 31 next year.

The FCA will shortly publish a Covid-19 Calculator to assist policyholders. The results of the calculator can be used to evidence whether Covid-19 was likely to be present in the relevant policy area but it is open to policyholders to carry out the calculations themselves.

Agents who are policy holders are strongly advised to participate and you can see more details here.

Estate Agent Today has seen a ‘brush off’ letter from one of the insurers at the heart of the controversy, Hiscox. It says in part: “The Supreme Court found that Hiscox’s policies can provide cover for businesses that were subject to mandatory closure restrictions if those businesses suffered an interruption to their business due to an inability to use their premises as a result of the restrictions. For those businesses not subject to mandatory closure, the Court found that it is likely that it will be difficult to demonstrate an inability to use their premises.”

Official guidance from the Ministry of Housing, Communities and Local Government back in March 2020 included the statement: “In line with advice for certain businesses to close, agents should not open branches to the public during this period, or visit people’s homes to carry out market appraisals.”


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