Manufacturers Insurance

The Supreme Court handed down its decision on the test case on business interruption claims involving COVID-19.
Essentially, the Court rejected all insurers’ appeals from the lower court hearing and pleasingly clarified many issues.
The abandonment of the Orient Express argument has been especially welcome by many as it has long seen to be a wrong decision that has resulted in so many claims for insureds having their claim reduced when in the past they would not have been.
The parties and the Supreme Court still have to issue declarations on which practical handling will be based.
We now wait the decision of the Australian test cases to see if they follow the same thought process as the UK or go in a different decision.
One of the things that I have been very keen to ensure is that insureds who have been through a great deal of financial and mental stress are not given false hope as this would be cruel in the extreme.
As I have reported, the Australian court has confirmed that those policies that have an exclusion which refers to the Biosecurity Act are valid and can be relied upon by the insurer.
There are a number of issues with the balance of the claims with one key issue being the geographical range in which an outbreak needs to have occurred. For example, if the policy provided cover for an infectious disease ‘at the premises’ and there was no outbreak at the Insured’s premises then of the face of it it is unlikely that there is no claim.
Having said that, policies are different and the entire wording needs to be read to see what extensions of coverage are available and what exclusions apply.
This article originally appeared on Adroit Insurance & Risk Blog and has been published here with permission.
Advisr does not provide advice and does not hold a financial service license (AFSL). All information above has been provided by Adroit Insurance & Risk.
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