Covid proved that business interruption policy wording wasn’t fit for purpose in some cases, so time for an overhaul;
The Lloyd’s Market Association (LMA) today announces the publication of a new model wording designed for small and medium-sized enterprises (SMEs) requiring property and business interruption insurance.
Developed in response to market demand and in line with the LMA’s continued commitment to supporting best practice, the new wording builds on the success of the LMA’s Consumer Household Insurance Policy. Following its publication, LMA members requested a comparable, high-quality wording tailored specifically for SME risks.
The policy provides comprehensive cover for damage to insured property and associated business interruption losses. It also includes a range of optional extensions, such as cover for business interruption resulting from property damage at the premises of a direct customer or supplier.
A key focus of the wording is clarity and accessibility. It has been drafted using consumer-friendly language, with an emphasis on readability and alignment with the FCA’s Consumer Duty requirements, supporting improved customer understanding and outcomes.
Development of the wording was led by the LMA’s UK/International Commercial Property & Household Business Panel.
David Powell, Head of Technical Underwriting at the LMA, commented: “This new model wording reflects our ongoing commitment to supporting the market with clear, practical and compliant documentation. By focusing on plain, consumer-friendly language and ensuring alignment with regulatory expectations, we are helping our members deliver better outcomes for SME clients while maintaining the technical robustness the market expects.”
The new wording is available on the Lloyd’s Wordings Repository.
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