Hiscox Tops List of Insurers Facing COVID Business Interruption Claims

Hiscox faces paying the out on the largest number of business interruption claims, according to data compiled by the Financial Conduct Authority (FCA).

Source: City AM | Published on May 13, 2021

Mandatory closures

Hiscox has accepted 6,692 business interruption claims for Covid-19 losses and faces making a decision on whether another 3,122 pending claims are valid, data published by the FCA today shows.

The insurance giant has paid 151 claims in full and made an interim payment on a further 1,068.

Behind Hiscox was MS Amlin Underwriting, which has accepted 3,432 business interruption claims as of today.

MS Amlin has paid 323 claims in full and made an interim payment on a further 159 claims.

The aggregate value paid out in interim or initial payments across insurers so far is more than £2bn.

Hundreds of thousands of businesses that were forced to close during the pandemic or faced significant losses made claims on their business interruption insurance, but leading insurers disputed the claims, arguing their policies did not cover the restrictions.

As a result, in late 2020 the FCA ran a ‘test case’ on behalf of business interruption policyholders seeking legal clarity on their Covid-19 losses.

Ultimately, the Supreme Court largely ruled in favour in the policyholders, paving the way for business interruption payouts related to Covid-19.

Groups of hospitality companies that have had their business interruption claims refused have since come together to potentially take legal action against their insurers.

City A.M. understands groups have been formed to potentially take against insurers Axa, Aviva, Alliance, RSA, Tokio Martine and NFU, some of which contain more than 50 members.

Insurers that have also accepted a hefty number of claims also include AXIS Managing Agency (3,005), AXA (2,963), Covea Insurance (2,885) and QBE UK (2,474).