Judgment was handed down yesterday in a long running dispute between Greggs and Zurich Insurance, plus Stonegate pubs vs MS Amlin, reports Reuters.
The cases, like many others, came about as a result of rapid closures of nearly all leisure eating businesses during the first phase of the pandemic. Although you could buy food at supermarkets and petrol stations, you could not visit takeaways or pubs, they were instructed to close along with most smaller shops.
THE GREGGS DECISION
Greggs has won £150m according to Reuters and Zurich initially paid just £2.5m for the first business interruptions early in 2020. The situation became complicated later in 2020 as the UK government caved into the MSM, so-called experts and many globalists who screamed for more lockdowns, which were supposedly necessary to slow the spread of Covid19.
But by that time, the UK regime had already paid out 10K to many small companies, offered generous Covid Bounceback loans to those who self-identified as needing 50K, and introduced a furlough scheme, which essentially paid employees 80% of their wages as they remained at home. This solved a huge wage bill problem for many big companies of course, although it didn’t replace profits lost by closing for business.
So you could argue that the overall losses in trade sustained by Greggs – or any other business – after the first lockdown of spring 2020 were mitigated in part by UK government intervention.
That would reduce the amount claimed as a direct loss via forced closure part two in late 2020. This would vary depending on the business. It’s worth noting that Greggs declared a loss of £13.7m for 2020 and a profit of £145m for 2021 when lockdown restrictions eased from March onwards.
MS AMLIN VS STONEGATE
Meanwhile another case involving pub chain Stonegate and insurer MS Amlin also had a decision moment yesterday, with MS Amlin offering this statement;
MS Amlin Underwriting Limited (MS AUL), the Lloyd’s (re)insurer, welcomes today’s (Monday) judgment in the Stonegate Pub Company vs MS Amlin & Others business interruption case, in which the Court has fundamentally supported insurers’ position.
The high-profile case, brought by the pub chain against its business interruption insurers sought a claims settlement of over £1bn, challenging their interpretation of a number of policy coverage issues, several of which are of significance to the wider industry.
The case formed part of a series of interlinked trials heard by the Commercial Court in London, and considered among other things whether Stonegate’s losses were limited by the aggregation language in the policy, the extent to which losses were caused by cases of COVID-19 and Government action within the policy period, and whether insurers were entitled to credit for furlough payments received by Stonegate. On all of these issues the Court has found almost entirely in favour of insurers.
Johan Slabbert, Chief Executive Officer, MS Amlin Underwriting Limited, said: “We welcome the judgment of the High Court, and believe this brings some genuine clarity to a very complex business interruption case. This is a positive outcome for us and is of significance to the entire insurance industry, who I’m sure will be keen to read the full details of the judgment, as issues around furlough payments and aggregation in particular have the potential to have an enormous financial impact for insurers throughout the UK.
As an insurer upon whom thousands of businesses rely for support, we have always taken our responsibilities extremely seriously. Covid-19 created unprecedented challenges for businesses across the country, and our commitment to helping our policyholders remains as strong as ever.”
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