* Could lead to payouts to hundreds of struggling firms
* Insurers to pursue appeal on two further policies
* Lawyers for policyholders claim significant victory
By Sinead Cruise
LONDON, Oct 21 (Reuters) - Six insurers have decided not to
appeal against a London High Court ruling that they were wrong
to reject claims from holders of three business interruption
insurance policies who have been pushed to the brink of collapse
by the COVID-19 pandemic.
RSA, QBE, Hiscox, MS Amlin
, Argenta and Arch were expected
to challenge the judgment to pay affected customers holding five
types of policy in a fast-tracked Supreme Court case to be heard
by end-2020.
But the appeals linked to the Resilience, Eaton Gate Retail,
and Eaton Gate Pubs & Restaurants policies have now been
dropped, legal documents show, raising hopes that hundreds of
vulnerable businesses could see their claims processed without
further delay.
A spokesman for RSA, one of the largest of the six insurers,
said it would work with broker Marsh to make interim payments
where appropriate.
Businesses across the world have been locked in disputes
with insurance companies over pandemic-related payouts.
Insurers say they are paying valid claims but that many
policies exclude pandemics, require physical damage to premises
or do not apply to widespread lockdowns, and paying out all
claims could be catastrophic for the industry.
"It is of course a huge win for large portions of the UK's
business community, which for so many months has been told by
insurers that insurance policies do not cover losses relating to
the COVID-19 pandemic; that is plainly wrong," said Mishcon de
Reya partner Sonia Campbell, on behalf of the Hospitality
Insurance Group Action.
Britain's Financial Conduct Authority brought a case against
a total of eight insurers in June to clarify whether 21 policy
wordings, affecting potentially 700 types of policies, 60
insurers, 370,000 policyholders and billions in insurance
claims, covered disruption and government-ordered closures to
curb the virus.
The High Court in London last month ruled that many business
interruption policies did in fact provide such cover.
Two of the eight insurers, Zurich and
Ecclesiastical, had already opted not to appeal.
According to the documents, the insurers will continue to
appeal the court's findings in respect to the Cottagesure and
the Eaton Gate Commercial Combined policies.
(Reporting by Sinead Cruise;
Editing by Alison Williams)
