The action group representing 400 firms seeking to have their business interruption policies with Hiscox Insurance triggered by the pandemic have hailed a High Court agreement on the case.
The Hiscox Action Group (HAG) said it had “secured a major victory against Hiscox Insurance” over its refusal to pay out on its Business Interruption policies.
It revealed that the legal teams for both sides in the High Court, have agreed for the action to be heard as one arbitration, with three arbitrators appointed to review four categories of policy.
HAG is seeking payment of over £40 million for policies that were intended to trigger when access to premises were restricted following the outbreak of a “notifiable disease”.
The group’s legal teams have contested that members have the right to arbitration written into their insurance contracts as a route to providing a swift way of resolving claims disputes.
Richard Leedham from Mishcon de Reya which is representing HAG in the case said: “Today’s agreement is a significant moment in our pursuit of Hiscox Insurance. We are very pleased that they have overall agreed to our proposals for a simple way of moving forward the arbitration process. Having one tribunal will bring clarity, speedup the action and provide consistent results for our members.”
The High Court action is part of a twin track strategy being pursued by the Hiscox Action Group. The HAG also joined the FCA action which finished late July and which is intended to provide clarity on over 50 insurance policies written by eight insurers. According to the FCA, up to 370,000 UK businesses could be affected by insurers failure to pay out on Business Interruption claims which suggests the total amount involved could be close to £4 billion.
Additional amounts are also likely to be sought by HAG policy holders under the Insurance Act which is intended to penalise insurers for not settling legitimate claims swiftly.
Mark Killick, a Hiscox Action Group steering committee member, added: “Today’s agreement is an important milestone in our campaign to force Hiscox to do the right thing and honour its obligations. Hopefully, the agreement on the arbitration route will bring new momentum to getting a quicker resolution and ease further financial hardship on our members.”