Service Decision Reference 2022-0242

• Case Outcome: Rejected
• Reference: 2022-0242
• Date: 25 July 2022
• Year: 2022
• Subject Matter: Service
• Finantial Sector: Insurance
• Conducts Complained Of: Rejection of claim

Decision Ref:

2022-0242

Sector:

Insurance

Product / Service:

Service

Conduct(s) complained of:

Rejection of claim

Outcome:

Rejected

LEGALLY BINDING DECISION OF THE FINANCIAL SERVICES AND PENSIONS OMBUDSMAN

The Complainants trade as a public house and hold a commercial insurance policy with the

Provider.

The complaint concerns a claim for business interruption losses arising from the outbreak

of coronavirus (COVID-19).

The Complainants’ Case

By email dated 17 March 2020, the First Complainant contacted the Complainants’ Broker

to advise, amongst other matters, that the Complainants had closed their business “in

accordance with current legislation.”

On 26 March 2020, the Broker emailed the First Complainant with the following update

regarding the cover provided under the policy, as follows:

“[The Provider] has issued the attached advice document to all insurance brokers in

respect of all their Commercial Property & Business Interruption policyholders.

Their position is very similar to most other insurers as I explained previously in that

COVID19 losses are not covered by their policies.

It will be interesting to see if they will change position as the Insurance Industry in

Ireland comes under external pressure from Government & Central Bankers to be pay

COVID19 claims.”

- 2 -

/Cont’d…

The Broker notified the Provider on 17 April 2020 of a claim for business interruption losses

as a result of the temporary closure of the First and Second Complainant’s public house on

16 March 2020 due to the outbreak of COVID-19, as follows:

“The insured wishes to make a formal business interruption claim due to their losses

suffered from COVID-19.”

By email dated 21 April 2020, the Provider wrote to the Broker to advise that the claim was

not covered by the policy, as follows:

“I am very sorry to hear about the difficulties your client is experiencing at this time.

Unfortunately, the Business Interruption section of the policy does not respond to

closure as a result of COVID-19, and I am writing to explain why this is the case.

Having reviewed your client’s policy (attached for your ease of reference), the cover

available to them under the policy includes an extension to the Business Interruption

section for losses due to the prevention of access to insured premises, see Business

Interruption - Extension 1 Prevention of Access.

However, despite this, the losses in this case are due to an excluded cause, that being

the decision of Government to take certain measures to seek to control the spread of

the pandemic. This action is not an event which is insured under the policy.

Whilst, therefore, there is cover for prevention of access there is an express exclusion

as follows:

Page 48, Extension 1 Prevention of Access, Exclusion (iii):

“...closure or restriction in the use of the premises due to the order or advice of the

competent local authority as a result of an occurrence of an infectious disease (or the

discovery of an organism resulting in or likely to result in the occurrence of an

infectious disease) food poisoning defective drains or other sanitary arrangements or

vermin or pests”

Therefore, our Prevention of Access extension excludes business interruption losses

due to prevention of access caused by the occurrence of an infectious disease, where

the closure is on the order or advice of the competent local authority.

Unfortunately, subject to any further information or representations you may wish

to provide us with on behalf of your client, for this reason it appears that your client's

claim is not covered under the policy.