Firms face insurance delay after High Court decision
THOUSANDS of businesses face a further delay before receiving possible insurance payouts for pandemic disruption after the High Court ruled that the Supreme Court s hould consider whether to hear appeals against a landmark ruling.
The Financial Conduct Authority brought the High Court legal action on behalf of policyholders to clarify whether Covid-related losses should be covered by ambiguous business interruption policies.
The FCA and insurers sought permission to appeal against various parts of a decision delivered by judges last month after talks among the parties failed to provide a truce that would have allowed money to start flowing to some of the 370,000 businesses affected.
Appeals from High Court decisions are normally heard by the Court of Appeal, with any further appeal then going to the Supreme Court, a process that can take years. Yesterday, the High Court granted permission for the parties to ask the Supreme Court to hear their appeals directly.
One of the defendant insurers, Ecclesiastical, said it would not take part in any Supreme Court hearing as the FCA was not appealing against the parts of the ruling that affected its policies. Separately yesterday, insurer LV confirmed it was in exclusive talks with US private equity firm Bain Capital over a possible takeover.
The news dashed the prospect of a merger with pensions, life and asset management firm Royal London in a deal that would have combined two of the City’s remaining mutuals.
The insurer had said on Monday it was still in discussions with several parties following reports it was in detailed negotiations with its rival.
LV said that talks with Bain were ongoing and there was no certainty any transaction would go ahead.