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Things you might not know about Business Interruption Insurance as a Business Owner

Most businesses will have insurance to protect against everyday risks and many businesses will have business interruption insurance to protect their cashflow should the unexpected happen.

When the coronavirus pandemic hit, many policyholders suffered significant financial losses and therefore attempted to claim on their business interruption policies. However, some insurers have disputed liability, on various grounds, causing concern over the lack of clarity in this area.

The Supreme Court has recently considered the position in a test case which included multiple insurers and the Financial Conduct Authority. The subsequent ruling of the Supreme Court has resulted in insurers being forced to reconsider claims in this area where cover has previously been declined.

The decision is considered to be an emphatic victory for the insured as it widened and clarified the interpretation of such policies to the benefit of the policy holder, particularly in the areas of disease and prevention of access – this is positive news for many businesses.

We are currently working with various businesses that had originally been declined cover on their business interruption insurance. It’s an easy and low risk process as we will review the policy for you (at no charge) to consider whether there is any scope to dispute the position with the insurer.

Further, particularly in the areas of hotels; holiday camps; restaurants; catering contractors; and even leisure and retail, if the cover you do have is not sufficiently comprehensive to cover the effects of Covid-19 or you were not advised to obtain this type of insurance then we can also consider the possibility of a potential claim against your insurance broker for negligence.

If you have any queries or would like to discuss your specific position with us, please contact John Carter (john.carter@bpe.co.uk, 01242 248243) or another member of the BPE Commercial Litigation team.


These notes have been prepared for the purpose of articles only. They should not be regarded as a substitute for taking legal advice.

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