LONDON, June 26 (Reuters) - Groups of Aviva, Hiscox
and QBE policyholders can join Britain's
markets watchdog in a High Court case to decide which insurers
should pay out to businesses shut by the coronavirus pandemic, a
judge said on Friday.
The policyholder groups would be able to present their views
directly alongside the Financial Conduct Authority, which is
consolidating the case for policyholders, High Court Judge
Christopher Butcher told a hearing.
"It is necessary...that the argument is fully and properly
put," he said at the hearing to discuss the procedural issues of
the case.
The Financial Conduct Authority (FCA) turned to the courts
after small businesses, from restaurants to leisure groups, said
they faced ruin after attempts to claim millions of pounds
collectively in compensation for lost business were rejected by
insurers.
The case against eight insurers, including Aviva, Hiscox and
QBE, is designed to clarify whether the pandemic and a
government lockdown should trigger business interruption
policies that provide cover when insured premises cannot be used
because of restrictions imposed by a public authority and in the
event of a notifiable disease or infection.
The test case is expected to provide clarity for tens of
thousands of policyholders, including those who have policies
with similar wordings sold by other insurers.
The FCA had agreed the policyholders could join and insurers
did not oppose, the hearing heard.
However, the judge declined to allow a policyholder with a
pubs policy with RSA, another of the insurers in the case, to
join. The pubs policy focused on physical damage to property
which was not within the scope of the case, he said.
Hiscox declined to comment while Aviva, RSA and QBE did not
immediately respond to requests for comment.
The Hiscox Action Group, which represents almost 400 Hiscox
policyholders, and an action group representing Aviva and QBE
policyholders, also did not respond to requests for comment.
The case is due to come to trial in late July.
($1 = 0.8050 pounds)
(Reporting by Carolyn Cohn and Kirstin Ridley; editing by
Emelia Sithole-Matarise)