Coronavirus: trade group takes legal action on insurance

THE Night Time Industries Association (NTIA), a trade group representing late-night venues across the UK, is to take legal action against insurance provider Hiscox Insurance for refusing what the group describes as “legitimate insurance claims” from its members.

The NTIA has instructed Philip Kolvin, a QC with Cornerstone Barristers, to co-ordinate claims against Hiscox for refusing to pay out under its business interruption policy. The NTIA claims there are already over 100 claimants involved and the group is looking for other businesses with a policy from Hiscox to join the case.

Michael Kill, chief executive of the NTIA, said: “One of the main leisure sector policies was underwritten by Hiscox Insurance, who have written to their clients denying liability. Philip Kolvin QC has advised that claimants who were insured by Hiscox against closure by public authorities and who had to close their premises under the regulations have a good case against Hiscox.

“We want to talk urgently to any businesses within the hospitality and leisure sector which have a policy with Hiscox and would like to join the current group of over 100 claimants to progress a legal case against the company.”

Kolvin said operators across the country are currently suffering “severe hardship” and called for insurance companies to support the sector.

“We should celebrate that the Night Time Industries Association has stepped up to the plate to support the sector,” he said.

“It is time now for those insurance companies who know they are liable under their policies to do the same. The clue is in the name ‘insurance’. It is what they are in business for. They should not be running for cover.

“They will never be forgiven for doing so.”

A market update on the Hiscox website acknowledged that the company has received business interruption claims related to COVID-19, but added that its “core small commercial package policies do not provide cover for business interruption as a result of the general measures taken by the UK government in response to a pandemic”.

“Hiscox UK has has approximately 10,000 customers that purchased cover for business interruption and have been directly impacted by mandated government premises closure to stop the spread of COVID-19,” said the statement.

“Over 70% of these customers have monthly revenues of less than £40,000 in a normal trading environment, with a significant proportion below £10,000 per month. The level of economic loss experienced is likely to be materially lower than reported revenues.

“A number of UK policyholders have disputed the application of their policy in relation to business interruption. Hiscox recognises these are extremely difficult times for businesses and is determined to help provide greater certainty for customers. As a priority it will therefore work with the UK insurance industry, its regulators and its customers to seek means of expediting resolution through the range of independent mechanisms available.”