On 10 June 2020, the FCA announced on its website that it had started proceedings in the High Court to resolve uncertainty over the validity of business interruption insurance claims. The test case in which the FCA is claimant and several insurance companies are defendants is brought pursuant to the Financial Markets Test Case Scheme.
The case concerns whether business interruption losses following from the COVID-19 pandemic are covered by the certain policy extensions or other clauses that do not require damage to the insured’s property. The FCA is seeking a determination of a number of points of construction that are in dispute between insureds and insurers. As claimant, the FCA is taking the approach that the relevant wordings to respond to COVID-19 events.
The FCA has published the various court documents relevant to the test case. These include the Claim Form and Particulars of Claim, documents relating to the facts of the case including a representative sample of policy wordings, illustrative factual assumptions and an issues matrix.
The hearing will take place in the second half of July.