QBE to appeal U.K. coronavirus coverage ruling
The U.K. High Court judgment would expose QBE to around $170 million in additional claims.
Global insurer QBE announced that it is planning to appeal the U.K test case judgment on whether business interruption policies should cover losses related to the COVID-19 pandemic. The judgment would expose QBE to around $170 million in additional claims.
The test case was filed in June by the Financial Conduct Authority, the U.K.’s corporate regulator, in order to determine if an infectious disease clause meant certain policyholders could claim for lost revenue from pandemic lockdowns.
Insurers brace for Australia test case ruling
The U.K. court judgment, at a staggering 150 pages, ruled that policies with clauses referencing infectious diseases should be paid by insurers. Such a ruling could have ramifications for Australians seeking compensation for the negative impact of the lockdowns.
Although most business interruption policies just cover property damage, the FCA argued that the infectious disease caused proximity issues similar to a natural disaster and those shock events that restrict trade should trigger coverage.
The Insurance Counsel of Australia (ICA) also launched a test case to determine if pandemic exclusions in business interruption insurance policies are valid after it was discovered that many policies listed an outdated definition of “quarantinable disease.”
The case is due to appear in the NSW Court of Appeal in October, and the ICA is evidently confident that the courts will rule in favor of the insurance industry.
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