INSURANCE
SECURING YOUR ASSETS BY SAM LEEDER
Our columnist with a guide on commercial insurance matters during the pandemic
COMMERCIAL INSURERS REACTION TO COVID-19 There has been a lot of noise within the media regarding the insurance reaction to the COVID-19 situation, which has created a potential expectation within businesses that commercial insurance policies provide some cover for Business Interruption. Unfortunately the vast majority of commercial policies do not provide any cover in respect of interruption to the business as a result of COVID-19. Generally speaking, only very large businesses with an international outlook purchase specific cover for pandemics. There are one or two insurers, who have very broad policy wordings, who are exposed to claims in these circumstances. That said, these insurers have effectively provided cover unintentionally and are therefore impacted massively by these claims
unLTDBUSINESS.COM
as the cover was never really charged for. The frustration from many policyholders is the speed at which insurance companies respond – in view of this the Financial Conduct Authority has written to the CEOs of all insurers urging them to move more quickly. In addition to this, they have confirmed that the Financial Ombudsman Service is available for policyholders to raise a grievance should they be unhappy with the responses received by their insurer or with any delay. While this situation is extremely unfortunate for individuals and for businesses, insurance is really designed to react to specific events which affect policyholders within a specific region or following an isolated event. Given that this is a global health crisis, it
is not really for the insurance industry to bail out the UK economy but rather for the government to step in, which it has, to a point. What we have seen from insurers, however, is them trying to assist policyholders on a day-to-day basis by relaxing their terms and conditions to reflect the fact that a huge number of business premises are now empty. Under normal circumstances the cover on an empty property would be severely restricted and there would be certain conditions regarding inspections that would be imposed. Most insurers are continuing to offer full cover, however they are asking that you at least visit your property on a weekly basis where you are able. In addition to this, they are also looking to help with premiums where a specific
reduction in turnover, wages or vehicle numbers can be identified. In this instance, some insurers will offer a refund of premium now, rather than waiting until next renewal. A number of businesses also use third party finance providers to pay their premiums and, much like the banks, these finance providers are trying to work with policyholders where possible to offer short payment breaks to ease cash flow issues. On the whole the industry is doing as much as it can to help business. If you would like more information on the help available, please get in touch. Sam Leeder ACII Actus Insurance samleeder@ actusinsurance.co.uk 0114 2903624 07718 189476
43
