Property Insurance Update – UK COVID Test Cases

02 June 2020

UK High Court test cases

The United Kingdom Financial Conduct Authority (FCA) is pursuing test cases with the High Court which address business interruption coverage for COVID-19 pandemic claims. It has engaged Colin Edelman QC, Leigh-Ann Mulcahy QC, Richard Coleman QC. The UK’s High Court interpretation of these covers will likely be persuasive in Australia, particularly where those wordings are reflective of those used in the test cases.

Key legal issues identified

The test cases will include policy interpretation of 17 business interruption wordings and therefore will cover a broad range of potential wordings. The FCA’s legal counsel identified these wordings as capturing the key legal issues in dispute between policyholders and insurers. They were identified after reviewing over 1200 policyholder submissions and the FCA approached 56 insurers. The key legal issues include:

  • Denial or prevention of access cover
  • Disease cover
  • Causation
  • Pollution and contamination exclusions

Critical dates

  • 9 June 2020: Test case claims will be filed by the FCA
  • 23 June 2020: Insurers’ defences will be filed
  • Early June 2020: FCA will publish a comprehensive list of other insurers and policies that it expects the test cases will effect.
  • Late July 2020: 5-10 day hearing before the High Court

Given the importance of the issue, it is expected that the judgments by the High Court will be handed down as early as August 2020.

For more information

Complete list of insurers and policies:
Selected 17 policy wordings:
Framework governing the process and timetable:
Proposed assumed facts:
Proposed issues matrix:
Proposed questions for the court:

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