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Financials

UK watchdog sets framework for insurers' Covid-19 court battle

LONDON, June 1 (Reuters) - Britain’s Financial Conduct Authority said it has selected a sample of insurance policy wordings for a court to consider in July if insurers should pay claims from companies hit by the Covid-19 pandemic.

The FCA said it has selected 17 examples from business interruption insurance policies used by 16 insurers who have entered into a framework agreement with the regulator for governing the process and timetable for the test case.

“Given the representative nature of the policies and wordings we have selected, we expect the test case to provide guidance for the interpretation of many other business insurance policies that are not in the representative sample,” the FCA said

“This means that other insurers will also be affected by the test case and its conclusions. In early July, we expect to publish a comprehensive list of other insurers and many other BI policies in the market that we expect the test case to affect, based on firm submissions.”

The FCA said it expects the court case will happen in the second half of July, lasting 5-10 days. (Reporting by Huw Jones Editing by Rachel Armstrong)

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