Following the recent Supreme Court judgment on Friday 15 Janaury 2021,"Supreme Court backs BI policyholders in FCA test case judgment" The Financial Conduct Authority has published (1 February 20201) a Policy Checker (see bottom of this article to hyperlink to the FCA policy checker website).
The FCA also published some FAQs to help small business insurance policyholders find out if their insurance policy may cover business interruption losses caused by Coronavirus. They advised policyholders to have sight of their "insurance policy wording including any schedule."
FAQs for policyholders
Q: Who can use the policy checker?
A: The policy checker is intended for small businesses.
Q: What can I use it for?
A: The policy checker is a general guide to help you check if your policy will cover business interruption losses due to the coronavirus pandemic. It is based on the outcome of the FCA’s test case.
Q: How does the policy checker work?
A: The policy checker helps you to check whether the wording in your policy is the same as, or very similar to, the 21 policies in the ‘representative sample’ considered by the Courts in the FCA’s test case.
If so, the High Court and the Supreme Court rulings provide important guidance on the way your policy should be interpreted and on the strength of your claim, based on the wording of your policy.
The policy checker will indicate whether your policy is likely to provide cover and the policyholder FAQs will give some further information about how to make a claim.
Q: Can the policy checker determine whether my claim is valid or the amount I am due?
A: The test case does not consider individual policyholders' claims on their specific facts. Each claim will need to be individually considered to determine whether the policy provides cover for the effects of coronavirus.
Policyholders will need to check:
- the extent of their cover including how long it covers them for (length of their indemnity period)
- what losses are included - such as loss of profit, fixed costs or increased costs of working
If you have already made a claim, your insurer should be in touch with you soon about the implications of the test case for your claim.
Policyholders are encouraged to contact their broker, accountant, other advisers or insurer for further information and support with the claims process.
To launch the FCA business interruption insurance policy checker CLICK HERE