The Supreme Court has substantially allowed an appeal brought by the FCA in landmark legal battle. This will render insurers liable to make payment to holders of certain business interruption insurance policies of claims which had hitherto been rejected. Some insurers had argued that Covid-19 pandemic incurred losses were not covered.
Lord Hamblen who announced the Supreme Court’s ruling said: “The appeals of the Financial Conduct Authority and the Hiscox Action Group are substantially allowed and the insurers’ appeals are dismissed. The appeal concerns the proper construction of 21 sample insurance policy wordings. It is estimated that, in addition to the particular policies chosen for the test case, some 700 types of policies across over 60 different insurers and 370,000 policyholders could potentially be affected by the outcome of this litigation.”
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