As a result of the UK government’s response to the Covid-19 outbreak, the vast majority of us are now working from home. However for a number of businesses, particularly those in the leisure & hospitality sectors, working from home was not an option and as such they have had to shut up shop for the time being, resulting in staff being furloughed and little to no money coming in.
With businesses forced to close through no fault of their own, many will have been both expecting and relying upon their insurance protecting them against future extraordinary events, such as coronavirus, by ways of business interruption insurance. Business interruption insurance covers a business for loss of income during periods when they cannot carry out business as usual due to damage caused by a specific set of perils that will be specified in the individual policy and can typically pay out up to £100,000.
However a number of businesses throughout the UK have reported insurance companies refusing to cover losses as a result of the coronavirus lockdown and rejecting their business interruption claims, despite their policy terms appearing to cover the current pandemic and government enforced lockdown. One provider in particular, Hiscox, has come in for significant criticism in recent weeks, with numerous small businesses coming together to seek legal advice on their next steps after being told their policies were “not designed to cover these extraordinary circumstances.” & that “Like terrorism and flood, which have government-backed insurance schemes, pandemics like coronavirus are simply too large and too systemic for private insurers to cover.”
This has left many businesses facing the very real prospect of bankruptcy if they are not able to cover the losses sustained during this period and not sure where to turn.
Key Considerations When Considering a Business Interruption Claim
At Jones Whyte, our are experts in all areas of contract law and will be able to review the terms & conditions of your insurance policy and advise whether you are likely to be able to claim for losses arising as a result of Covid-19 and the lockdown. We can also then contact your insurance provider on your behalf, review their response and advise on the best course of action.
Contact us today on 0141 375 1222 or to speak with an expert and get the advice you need to steer your business through this difficult time.
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