Tens of thousands of small businesses could be set to finally receive insurance payments covering their loses from the first lockdown, following a new court ruling.
The Supreme Court has found in favour of SMEs receiving payments if they had business interruption insurance policies. The ruling is expected to cost insurance companies hundreds of millions of pounds.
The test case was brought by the Financial Conduct Authority, with eight insurers agreeing to be part of the proceedings.
FCA’s Sheldon Mills said: “We will be working with insurers to ensure that they move quickly to pay claims that the judgement says should be paid, making interim payments wherever possible.”
Insurers involved in the test case include Hiscox, Arch, Argenta, MS Amlin, QBE and RSA, but some 60-plus other insurance companies sold similar business interruption products.
Huw Evans, director general of the Association of British Insurers, said: “All valid claims will be settled as soon as possible and in many cases the process of settling claims has begun.
“We recognise this has been a particularly difficult time for many small businesses and naturally regret the Covid-19 restrictions have led to disputes with some customers.”