News of a glimmer of hope to business owners in the leisure and hospitality sectors was announced on 15 January 2021, as the Supreme Court delivered its judgement on appeals heard for the Financial Conduct Authority’s (FCA’s) business interruption insurance test case, with the court ruling in favour of those with business interruption insurance being able to claim on cases related to Covid-19.
The news has been widely welcomed by a sector which has been one of the hardest hit by the pandemic, offering a lifeline to thousands of business struggling to survive various lockdowns and restrictions on trade.
The decision provides guidance for a collective of 700 policies, which could benefit nearly 370,000 small businesses across the UK. It will however all depend on the wording used within the insurer’s policy, which could lead to only some of these businesses being able to claim for business interruption, as only 21 sample policies were tested in court, out of over 500 possible wordings.
Although expected to be substantial, the full effects of this decision are yet to be witnessed and will take some time to be realised.