Successfully negotiating claims since 1867
It’s been a couple of weeks since we published our last news about the handling of Covid-19 cases. In those weeks many sectors of the insurance market have made their intentions clear, and those intentions are rarely encouraging for the insurance buyer. We are beginning to see the defences offered, frequently in the face of wording that appears to cover the claim. The thrust of these is “it was never our intention to cover a pandemic”, ignoring the basis fact that, whatever the intention, the policy doesn’t necessarily work that way.
There are some policies that can never respond. Most of these offer disease cover, but define “notifiable disease” by listing the illnesses requiring notification under the 1988 Public Health Regulations. Obviously, Covid-19 isn’t in that list, and as the policy wording is precise we think the chances of successful appeals against claim denial are slim.
Many policies cover the obvious premises risk, but also the wider risk of an occurrence of the disease within a specified radius, anything from 1 mile to 25 miles. Proof of such an occurrence is simple, but the argument raised is that the occurrence must affect the insured premises directly, and the effect is indirect, essentially a new, intervening cause, the lockdown. We expect that defence to be the subject of much legal activity.
We have also seen attempts to adjust the claim regardless of liability! And the adjustment, of course, is to zero. We have no doubt that some of the arguments on that – on which we shall comment in a later newsletter to you – will be advanced on all claims for which liability does operate, but to adjust claims at zero without even considering liability strikes us as rather impertinent.
Many of you have sent us policy documents for our opinion and we’ve tried to get our thoughts back to you quickly, but as you can.appreciate we have been inundated with enquiries . Life and work have been hectic, not only with policy analyses, but on everything we’ve seen we’ve been working with the broker and talking to lawyers to see how economical models of legal advice and action can be built. We’ll tell about those when we know how.
In the meantime, thank you all for your support.