Covid-19: Boost for small businesses as Supreme Court orders £1.2bn insurance payouts

A number of small businesses in the UK are to benefit from a Supreme Court ruling urging insurers to pay up following disputed business interruption claims.

In a payout said to be around £1.2bn, businesses that may benefit include beauty salons, pubs and cafés that were turned down for business interruption policy claims on losses caused by the first coronavirus lockdown.

Large commercial insurers, including Hiscox and Arch, had told the Supreme Court in 2020 after the initial claims that many business interruption policies did not cover the ‘widespread’ disruption of the coronavirus.

The ruling is seen as a ‘massive boost’ for UK businesses.

Customers who have made such claims should be contacted by their insurer about what the judgement means for their business interruption claim.

The FNP comments: “This is great news for UK businesses that had business interruption cover on their policy at the time of the first lockdown, but were denied being able to claim.

“The UK Supreme Court has ruled against the appeal by the UK insurers meaning, if you had this cover on your policy , you will now be able to claim successfully for loss of earnings due to pandemic restrictions.

“Although this won’t benefit every business, let’s all breathe a sigh of relief for those that can now receive this lifeline.”