London | A British court has ruled against QBE and seven other insurance giants in a dispute over claims for coronavirus-related payouts on their business interruption policies
The judgement released late on Tuesday (AEST) found that some QBE policyholders were entitled to claim for losses suffered from the broader effects of the coronavirus pandemic, and weren’t limited to impacts from the oubreak in their immediate vicinity.
The insurers are expected to appeal the decision, but it could encourage a slew of British restaurants, cafes, pubs, cinemas, hotels and shops to seek payouts under their non-damage business interruption insurance.
Some QBE policies, though, were found to be watertight to these claims. Law firm Mishcon de Reya, which is running class actions on behalf of affected businesses, said it would “consider further with affected parties” what to do in those cases.
QBE has not commented on the judgment. It has previously told the ASX that its reinsurance practices would limit the cost of coronavirus-related business interruption insurance claims in Britain to $US75 million ($103 million).
The insurer has also said that its business interruption policies “do not typically cover claims arising from COVID-19”.
The British regulator which brought the test case, the Financial Conduct Authority, welcomed the outcome.
‘Insurers should reflect on the clarity provided here and, irrespective of any possible appeals, consider the steps they can take now to progress claims of the type that the judgment says should be paid,” said FCA interim CEO Christopher Woolard.
“They should also communicate directly and quickly with policyholders who have made claims affected by the judgment to explain next steps.”
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