Leading hospitality bodies across the UK have issued a joint statement that “strongly” welcomes action the FCA has taken against insurers.
It comes as the FCA yesterday (1 June) announced that eight leading insurers would be called upon to join a test case in the commercial court in order to resolve liability issues under business interruption insurance policies.
The action comes as many hospitality claimants have had their business interruption claims refused, with insurers claiming their policy wording does not include government responses to the pandemic.
In light of this, the insurers called upon by the FCA include Hiscox and QBE, who are two of the main insurers to the hospitality industry.
The court action will begin by 9 June, and all formal pleadings are set to be completed by 3 July. The date for trial is likely to be set at a preliminary hearing shortly after 9 June, and is expected to take place in July.
The Night Time Industries Association (NITA), UKHospitality and the British Beer and Pub Association (BBPA) are amongst those that have endorsed the test case. They have also been joined by NDML, leading brokers to the hospitality industry, as well as Black and White Hospitality.
Emma McClarkin, CEO of BBPA, said: “Our member survey revealed the shocking number of businesses that have had policy claims refused or are still awaiting.
“The BBPA views the action being taken by the FCA as the most robust and effective means of resolving the issues across a range of insurers and policies, and therefore together with other industry bodies we support the FCA’s initiative to bring clarity for thousands of struggling businesses.”
Michael Kill, CEO of NTIA, said: “We welcome the news from the FCA today on the progress of their action against insurers. The policies and wordings highlighted within the regulator’s proposed claim are in line with our expectations.
“Alongside other trade bodies, we continue to support the FCA’s initiative, to bring about a level of clarity to many struggling businesses who should have received money from insurers based on legitimate claims.”
Kate Nicholls, CEO of UKHospitality, added: “We are delighted to see that the FCA has taken on board the legitimate claims of hospitality businesses against their insurers.
“These businesses have been hit hard by the coronavirus and had expected their insurance policies to cover them for forced closures. It is time that insurers played fair and stopped hiding behind technicalities.”
Rob Atkinson, legal director of Black and White Hospitality, concluded: “The FCA says it wants to “achieve clarity for all concerned in an unprecedented situation” so we’ll watch with interest how the test cases proceed.
“One thing is clear: we remain resolute in our own campaign to make sure that all those in the hospitality sector who in good faith took out BI policies receive what they fully deserve.”