Other Decision Reference 2022-0254

Case OutcomeRejected
Subject MatterOther
Date29 July 2022
Finantial SectorInsurance
Conducts Complained OfRejection of claim
Decision Ref:
Product / Service:
Conduct(s) complained of:
Rejection of claim
The Complainant, a limited company engaged in the provision of employee relations
solutions (“the Complainant Company”) and held a ‘Business Policy’ of insurance with the
This complaint was made to the FSPO in February 2021, and it concerns a claim for business
interruption losses arising from the outbreak of coronavirus (COVID-19).
The Complainant Company’s Case
By email dated 30 March 2020, the Complainant Company’s Broker (“the Broker”) advised
the Complainant Company in respect of the cover available under its policy for business
interruption, as follows:
“As per our conversation on the phone I can confirm [the Provider] will only cover
business interruption for COVID 19 (Notifiable disease cover) if the business was closed
due to someone contracting the virus.”
The Complainant Company responded the same day, stating it did not accept the Provider’s
position on cover and requested that the Broker advise as to the claims process.
- 2 -
On 7 April 2020, the Broker notified the Provider of the Complainant Company’s intention
to proceed with a claim for business interruption losses due to the outbreak of COVID-19,
as follows:
“Please be aware the above client is looking to proceed with a claim under the BI
section of this policy Due to Convid19 (sic).
I have asked the client to quantify their claim and I will advise once they do.”
By email dated 9 April 2020, the Provider wrote to the Broker, providing a claim reference
number and the name of the claims hander.
In an email to the Broker dated 15 April 2020, the Complainant Company, stated in part, as
“The principal question we raised, however, is relatively straightforward. Does [the
Provider] accept that the business interruption insurance which we purchased covers
this situation, where we have been obliged to close our […] to Government
restrictions resulting from COVID-19, and where other customers have formally
notified us they cannot continue work in relation to their normal activities, enter their
premises or conduct normal business […]
Our principal concern at the moment is that it has previously been indicated to us
that [the Provider] “will only cover interruption for COVID-19 (Notifiable disease
cover) if the business was closed due to someone contracting […]
Can it be confirmed that [the Provider] is accepting claims for business interruption
due to COVID-19?”
On 16 April 2020, the Provider wrote to the Broker acknowledging the claim notification. In
this letter, the Provider recorded the date of loss as 13 March 2020 and the type of loss as
business interruption due to COVID-19. The letter also set out the basis of the cover provided
under the ‘Notifiable Diseases Section’ of the Complainant Company’s policy, as follows:
“The cover, provided under the Notifiable Diseases Section of your policy, operates
only where there is loss resulting from interruption or interference with the business
as a result of any occurrence of a notifiable disease at the premises, which causes
restrictions on the use of the premises on the order or advice of the competent
authority. The indemnity period is from the date on which the restrictions on the
premises are applied for a maximum period up to three months, and is subject to a
limit as noted in your policy.”
- 3 -
This letter also requested the following information to allow the Provider to assess the
Complainant Company’s claim:
“To enable us to investigate and consider your claim please let us have details of the
occurrence of COVID-19 at your premises. This should include the following:
" The date of the occurrence or when it was first brought to your attention;
" The date on which the restrictions were put in place;
" The period of the restrictions; and
" Copies of any notices or relevant documents in support of your claim.
Once we have the required information, we will come back to you as quickly as
possible with a decision on cover.”
The Provider wrote to the Broker on 3 June 2020 requesting a response to its earlier
correspondence. By email dated 17 June 2020, the Broker wrote to the Provider, as follows:
“The has (sic) advised they do not accept the position of [the Provider], as indicated
to them and wish to make a formal complaint.”
The Provider responded to the Broker on 18 June 2020, as follows:
“Can you please explain the basis for the complaint since we issued a letter to your
office on 16/4/20 requesting various details to enable us investigate and consider the
claim […]. A reminder letter was also issued on 3/6/20 […].”
On 8 July 2020, the Provider wrote to the Broker requesting a response to its earlier
correspondence regarding the assessment of the claim.
The Complainant Company emailed the Broker on 16 June 2020 in respect of the claim and
the Provider’s position on cover. The Complainant Company also attached a letter to this
email. It appears that both the Complainant Company’s email and letter were forwarded to
the Provider by the Broker on 16 July 2020. The Complainant Company’s email states, as
“Further to our telephone conversation, please find attached letter which has been
sent by post.
Also attached is a copy of the Proposal that we received from [the Former Broker] at
the time of renewal.

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