Paying out Insurance Claims

The CII Journal reports “Insurers must not revise their coverage to save themselves from the fallout of Covid-19 claims, top lawyers warn.  Experts at law firm Hogan Lovells are urging insurers to behave responsibly by honouring business interruption (BI) claims that have arisen due to the current coronavirus pandemic.”

“This comes after reinsurance broker Willis Re recently described the risk from coronavirus-related BI claims as an “existential threat to the entire industry, given growing calls to revise coverage retroactively and the colossal, if notional, aggregate limits deployed irrespective of contract agreements in place”.

“Jamie Rogers, a partner at Hogan Lovells, says: “It is unlikely that UK government will intervene to force insurers to pay business interruption claims, which are not covered under contract wordings.

“However, insurers’ ability to navigate the pandemic without adverse government interference will be conditional on the industry behaving responsibly. UK regulators have made clear that they expect insurers to pay valid claims promptly, and to provide clear explanations for denials of coverage.”  Read all