Covid19 Business Cover Claims: Judgment Offers Mixed Results

Case report on a Covid19 claim;

The Commercial Court has handed down judgment in the latest Covid-19 business interruption insurance test case (“LMIE Test Cases”). The judgment produced mixed results, but crucially for policyholders, Mr Justice Jacobs concluded that a Liberty Mutual Insurance Europe (“LMIE”) wording would provide cover for business interruption losses caused by Covid-19.

This follows the decision by the same judge in the ‘ATP test case’ won by the Stewarts team for London’s ExCel centre in June 2023, which established that the Supreme Court’s reasoning in the 2021 FCA Test Case extended to ‘at the premises’ disease clauses found in policies held by thousands of other policyholders.

Mr Justice Jacobs’ latest ruling means that a further large cohort of businesses may now be entitled to pursue hitherto unpaid business interruption clams for their Covid-19 losses.

Aaron Le Marquer, Head of Policyholder Disputes at Stewarts, says: “The latest test case decision represents a further win for policyholders and is in many ways the natural conclusion of the FCA Test Case commenced in 2020. The court’s decision has established that policyholders insured under Prevention of Access wordings whose claims were initially declined following the Test Case decision in September 2020, may now finally be entitled to pursue their claims.”

Aaron Le Marquer and James Breese of Stewarts, with Adam Kramer KC and William Day of 3VB, represented Liberty Retail, Bath Racecourse and numerous other leisure and hospitality venues (“Arena Group”).

See our further analysis of the decision here.