On Tuesday (14 September 2020) the High Court handed down its judgment in the Covid-19 Business Interruption insurance test case which was initiated by the Financial Conduct Authority.  The case considered 21 sample wordings from eight insurers and focused on the correct construction of certain non-damage business interruption insurance extensions and related clauses.

The case was a resounding success for policyholders, who now have a clear avenue to recovery under such non-damage extensions.  Of particular interest was the Court’s commentary on the case of Orient Express Hotels Limited – v- Assicurazioni Generali SpA [2010] EWH1186 (Comm) and the operation of what is known as the “Trends Clause”.  Insurers relied heavily on the Orient Express case, but the Court concluded that it was irrelevant to the construction of the wordings it considered and, moreover, said that if it had to rule on the case, it would have determined that it was wrongly decided.

A hearing is now scheduled for early October 2020 at which the Insurers must decide if they wish to appeal the judgment and, if they do, whether that appeal should be fast tracked to the Supreme Court.  How this impacts on current claims remains to be determined.

Claimant policyholders will undoubtedly be encouraged by the ruling.  Roger Franklin, Edwin Coe’s Head of Insurance Litigation, commented as follows:

“This judgment brings welcome clarification for many policyholders, particularly SMEs, who have suffered immensely in the pandemic.  The FCA is to be commended for its swift action in seeking to resolve these issues.   It is to be hoped that Insurers now approach the payment of these claims with the same alacrity with which they denied them.” 

Edwin Coe LLP specialises in representing policyholders against Insurers and was proactively engaged advising a number of the Claimant groups in the FCA test case, notably those claiming against Hiscox, RSA and Allianz Insurance plc.

If you have a claim which you think should be pursued as a result of this decision, please contact our Insurance Litigation team and we can advise on your available options.


Please note that this blog is provided for general information only. It is not intended to amount to advice on which you should rely. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content of this blog.

Edwin Coe LLP is a Limited Liability Partnership, registered in England & Wales (No.OC326366). The Firm is authorised and regulated by the Solicitors Regulation Authority. A list of members of the LLP is available for inspection at our registered office address: 2 Stone Buildings, Lincoln’s Inn, London, WC2A 3TH. “Partner” denotes a member of the LLP or an employee or consultant with the equivalent standing.

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