Business

Over £470m paid out to BI claimants by insurers

The FCA has been collecting data from the insurers whose non-damage business interruption policies were affected by the result of the FCA test case

The Financial Conduct Authority (FCA) has revealed that over £470m in non-damage business interruption claims has been paid out by insurers over the past year.

Yesterday (22 March), the regulator published information from insurers whose non-damage business interruption (BI) policies were impacted by the result of the FCA test case.

The aggregate value of initial payments made for the 2,030 unsettled claims came to £192,084,302, while the average value of payments made for the 8,177 claims where final settlements have been agreed and paid came to £279,823,468.

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According to the FCA, this means that at the point of this latest information submission, 10,207 BI policyholders out of the 21,140, who had had claims accepted, had received at least an interim payment.

In January 2021, the Supreme Court allowed the FCA’s appeal on behalf of policyholders, resulting in thousands of policyholders now having their claims for Covid-related BI losses paid.

The regulator released data figures from more than 50 BI insurance providers following the payouts, including Allianz, Arch, Hiscox and Zurich.

In a statement, the FCA stated: “We noted some insurers may have reached different conclusions on whether similar policies are, in principle, capable of responding to the Covid-19 pandemic. This is particularly the case for policies which require the policyholder to prove the presence of coronavirus at the premises.

“This may affect the number of accepted and pending claims that some insurers have reported. We will work with relevant insurers to ensure consistency in future reporting and will gather and publish this data each month.”

 

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