News & Events

Business Interruption Insurance Test Case Brought by the Financial Conduct Authority (FCA)

Friday, July 24, 2020

On 1 May 2020, the Financial Conduct Authority (FCA) announced its intention to obtain a court declaration to resolve contractual uncertainty concerning business interruption (BI) claims arising from the COVID-19 pandemic. For the purposes of the test case, the FCA approached several insurers and confirmed on 1 June a sample of 17 wordings from insurers, excluding Tokio Marine HCC, which are representative of the key arguable issues. 

Taking into consideration the representative nature of the policies and wordings selected, the FCA anticipates that the test case will provide guidance for the interpretation of many other BI policies that are not in the representative sample. 

If you submitted a claim or complaint under a relevant non-property damage BI policy, you will have been notified by 15 July 2020 as to whether your claim or complaint is potentially affected by the test case and the implications of that. 

Should you wish to know more about the test case, the FCA website has useful information that is updated regularly: 

Timetable for the test case:

9 June
FCA starts claims in the High Court
16 June
Case management conference, at which the court fixes the timetable for the case and other procedural matters
23 June
Insurers file defences
26 June
Further case management conference, at which the court deals with any outstanding procedural matters to ensure the case is ready for trial
3 July
FCA files reply
First half July
Skeleton arguments and replies served
20-23 July and 27-30 July                     
Eight-day court hearing before Lord Justice Flaux and Mr Justice Butcher

Who to Contact?

If you have any questions, in the first instance, please contact the broker or the firm that arranged the insurance for you. These details should be provided on your policy documentation.