UK regulators are to go to court in an effort to sort out the growing controversy over business interruption insurance. Many struggling businesses say that the terms of their policies provide cover for the disruption caused by the coronavirus outbreak, but insurers disagree and say that in most cases losses are not covered. There are fears that many small companies could go bust before the dispute is resolved.
It has written to a number of insurers to ask for clarity on their policy wordings before going ahead with the court action. “Our intended court action is designed to resolve a selected number of key issues causing uncertainty as promptly as possible and to provide greater clarity for all parties,” said Christopher Woolard, interim chief executive of the FCA. “It is clear that decisive action is appropriate given the severity of the potential consequences for customers.”