Concern About BI Claims Across the Pond
Insurance executives around the world are keeping an eye on how the United Kingdom (UK) is handling the issue of Business Interruption (BI) claims related to the pandemic.
Britain’s highest court has ordered the U.K.’s leading insurance companies to pay millions of pounds to thousands of small businesses that filed claims for the disruption of their operations during the coronavirus pandemic. Industry sources say that the court’s decision will lead to widespread disputes between insurers and reinsurers about who should cover the cost of the claims. Top executives with insurance companies said the judgment affecting 60 insurers failed to clarify whether insurers or their reinsurers should have to shoulder the payments. One senior insurance executive said that the court left it up to the industry to fight it out.
Investors around the world are closely watching how Britain is handling the issue because many disputes between insurers and businesses over pandemic claims worldwide are yet to be resolved. In the United States, for example, pandemic-hit businesses have filed nearly 1,500 individual lawsuits. Insurers have won a large chunk of cases so far.