Retail Decision Reference 2022-0221

Case OutcomeRejected
Subject MatterRetail
Date29 June 2022
Finantial SectorInsurance
Conducts Complained OfRejection of claim,Failure to process instructions, Failure to provide product/service information
Decision Ref:
Product / Service:
Conduct(s) complained of:
Rejection of claim
Failure to provide product/service information
Failure to process instructions
The Complainant, a sole trader trading as a coffee shop and sandwich bar, held a ‘Small
Business Insurance Shop Policy’ with the Provider. The complaint concerns a claim for
business interruption losses arising from coronavirus (COVID-19).
The Complainant’s Case
In April 2020, the Complainant made a claim under the ‘ Murder Suicide or Disease’
extension of ‘Section 4(a) – Business Interruption’ of her ‘Small Business Insurance – Shop
Policy’ for business interruption losses arising from COVID-19. This claim was later admitted
and settled by the Provider.
By email dated 22 October 2020, the Complainant’s Broker notified the Provider of a further
claim for business interruption losses, as follows:
“We wish to put you on notice of a BI Claim. Due to COVID-19 restrictions Insured only
able to offer a Take Away Option to customers since the 1/10/2020 and this is going
to continue for a further 6 weeks assuming that the Take Away Option will sustain
some income.
Income is looking to be down by 80 to 90% for the period referred to above and we
wish to register a BI claim.”
- 2 -
Following its assessment, the Provider wrote to the Complainant on 17 November 2020, to
advise that it was declining the claim, as follows:
“We have reviewed your policy and note there has been a previous business
interruption claim relating to the COVID-19 Pandemic. That claim covered losses for a
three-month period from 16/03/2020. [The Provider] paid that claim under the
Murder Suicide and Disease extension of your policy. Under that clause the maximum
cover is for three months business interruption during the indemnity period of the
policy. We have copied in the relevant section of your policy below, and we would
draw your particular attention to the final paragraph which we have highlighted.
In these circumstances the settlement of the earlier claim exhausted the full benefit
to which you are entitled under the Murder Suicide and Disease extension of your
policy. Accordingly, [the Provider] will not be in a position to deal with this claim. […]
Section 4(a) - Business Interruption
F Extensions of Cover
1 Murder Suicide or Disease
The insurance by this Extension shall only apply for the period beginning with the
occurrence of the loss and ending not later than three months thereafter during
which the results of the Business shall be affected in consequence of the Damage
By letter dated 26 November 2020, the Complainant’s Loss Assessor wrote to the Provider
disputing its entitlement to decline the Complainant’s claim, as follows:
“I must advise that I would dispute your grounds for declining admission of this claim.
The claim is a distinct and clearly separate claim from the previous one. You appear
to be trying to extend the indemnity period from the previous claim, albeit this is
patently not the case. There is nothing in the Policy wording that limits cover to only
“one” claim per period of cover, under Section 4(a). F Extensions of Cover.
[…] Please note that, where there is any ambiguity in policy wording, the Insured is
entitled to the benefit of any doubt. However, in this instance, I cannot even see that
there is any ambiguity!”

To continue reading

Request your trial

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT