Context
In January this year the FCA sent a Dear CEO letter to insurers affected by the Test Case which explained that it intended to gather information on all non-damage Business Interruption (BI) policies that can respond to the Covid-19 pandemic following the Court judgments. A list of updated policies was published on 12th March 2021. The letter also set out the intention to gather information from all affected insurers regularly on the progress of their non-damage BI claims and to publish some of this data.
Key points to note
The FCA has publish the following information at individual firm level:
- BI claims where the insurer has received all the information required to enable them to calculate the total value of the claim
- BI claims for Covid-19 related loss that have been accepted
- BI claims where the insurer’s decision as to whether there is a valid claim is pending
- unsettled BI claims where an interim/initial payment has been made to the policyholder or their representative
- BI claims where an offer of final settlement has been made, accepted by the policyholder, and paid in full.
Some of the figures published include:
- The aggregate value of the interim/initial payments made for the 4,403 (5th September: 4,568) unsettled claims where such payments have been made is £329,368,933 (5th September: £328,908,143).
- The aggregate value of the payments made for the 24,463 (5th September: 22,680) claims where final settlements have been agreed and paid is £766,598,035 (5th September: £696,244,085).
- This means that (at the point of this information submission) 28,866 (5th September: 27,248) BI policyholders out of the 42,222 (5th September: 42,308) who had had claims accepted, had received at least an interim payment.
Next actions
Primarily this is provided for information, but firms involved in dealing with BI claims should be aware of the data and keep the results in mind when considering their claims handling processes.