17 November 2020

The next chapter in the COVID-19 business interruption insurance saga

The fate of many businesses will be decided over the coming weeks as the Supreme Court considers whether business interruption insurance policies must pay out in respect of losses suffered by businesses as a result of the first lockdown.

The test case has been brought by the Financial Conduct Authority (FCA) on behalf of policyholders against a number of well-known insurers and was initially heard by the High Court in September. As we noted in COVID-19 and business interruption insurance – can business owners stop losing sleep?, the High Court did not provide a clear-cut answer and the case has now been fast-tracked to the Supreme Court.

Almost 400,000 policyholders will be affected by the ruling and for some businesses, the decision will determine whether they can remain in business or be forced to cease to trade. The Supreme Court began hearing from the respective parties’ lawyers yesterday and the hearing is expected to last for four days, although it will take some weeks for the final judgment to be given.

Lianne Baker is a Knowledge Development Lawyer in our Corporate team.


This note reflects our opinion and views as of 17 November 2020 and is a general summary of the legal position in England and Wales. It does not constitute legal advice.

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