Business Interruption Insurance and Sport

As a result of the stance taken by many insurers not to pay out on COVID-19 business interruption insurance (“BII”) claims, the Financial Conduct Authority (the “FCA”) brought a test case in the High Court against a number of insurers. In September 2020, the High Court found in favour of some policy holders, potentially giving the green light to BII Claims. The relevant insurers were given permission to appeal by the Supreme Court.

The Supreme Court has decided in favour of policy holders, which means that you may be able to bring a BII claim, against your insurer, for a considerable sum.

The FCA stated “the Supreme Court ruled that cover may be available for partial closure of premises (as well as full closure) and for mandatory closure orders that were not legally binding; that valid claims should not be reduced because the loss would have resulted in any event from the pandemic; and that two additional policy types from insurer QBE provide cover. This will mean that more policy holders will have valid claims and some pay-outs will be higher.”

This is an excellent outcome for BII policy holders as appeals made by six leading insurers have been dismissed. The FCA will be working with insurance businesses to ensure they start paying eligble businesses as soon as possible. Your Club could be eligible to bring a BII claim now.

Please contact our Sports Team to review your policy and offer some initial free advice to your Club.

For further information relating to the BII test case, please click here.

We have also put together some FAQ’s for policy holders, which may be of interest.

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The content of this page is a summary of the law in force at the date of publication and is not exhaustive, nor does it contain definitive advice. Specialist legal advice should be sought in relation to any queries that may arise.