Insurance Ireland recognise this has been a particularly difficult time for many small businesses given the Covid-19 lockdown restrictions. We also recognise that the situation has led to some disputes with customers and are committed to improving consumers’ understanding and trust in insurance products.
We estimate that Covid-19 business interruption claims involving our members will amount to approximately €430m. This estimate is subject to variability as the situation unfolds and claims develop.
Our members are working hard to ensure that customers have the clarity they need when it comes to their business interruption policies. Members agreed that the Government advice to close a business in the context of Covid-19 is the same as a direction in this instance and will be recognised as such. It is important to note, however, that each policy is different and there may well be other factors which lead to the adjudication of whether a claim is valid or not.
Most standard business interruption policies in the Irish market do not provide cover for pandemics such as Covid-19. This is also the position in the UK and across Europe. However, insurers are very mindful of their commitments to their customers and will adjudicate each claim fairly and consistently in line with the policy terms and conditions. The decisions that insurers make regarding contractual obligations and claims handling are subject to rigorous regulation and oversight, including the Consumer Protection Code and the Central Bank of Ireland’s Covid-19 and Business Interruption Insurance Supervisory Framework.
Questions and Answers
Q. What is Business Interruption Insurance?
Business interruption insurance is often included in or offered as an optional extra to business insurance package policies which combine a number of different covers under one policy. It can also be offered as an optional extension to commercial property insurance policies.
The majority of policies will provide cover for business interruption where physical damage is caused to the premises. These policies are tailored to the needs of the individual business, there is no one size fits all approach, as the insurance needs of two businesses differ considerably.
Q. Does my Business Interruption Policy Cover Covid-19/infectious diseases?
There are three types of business interruption policy in this context. There are some where there is no cover for infectious diseases, there are others where there is cover up to stated limits of indemnity and claims are being paid in line with policy terms, and there are some instances where it is ambiguous and the subject of dispute.
Some businesses may have chosen to purchase cover that will specifically provide for non-damage business interruption arising from notifiable or infectious diseases. You should examine your policy schedule to determine whether cover applies and if you have a valid claim under the terms of the policy. The Insurance Product Information Document (IPID) will also provide an overview of what is included or excluded.
Q. How can I make a claim?
You should contact your insurer or broker. Details on the claims process will be included in your policy documents.
Q. Do I need to use a public loss assessor to make my claim?
Your insurer will help you through the claims process and provide you with appropriate updates on its status. If you purchased the policy through a broker, they may also be able to assist you with your claim.
With the nature and complexity of business claims, you may wish to appoint a public loss assessor with the required expertise to process your claim with the insurer on your behalf, at your own expense.
Q. I cancelled my policy, or the policy term has expired – can I still make a claim?
The policy schedule or your IPID should provide the term of the contract i.e., the inception date of the policy and the end date of the policy. If this is not clear you should contact your insurer or broker.
Q. How do I determine whether my claim is valid or the amount I am due?
Insurers will assess each claim on an individual case by case basis to determine whether cover is triggered to respond to a claim under the terms of the policy. You should contact your insurer or broker for more information on the claims process if necessary.
Q. I am not satisfied with how my insurer/broker is dealing with my claim.
If you disagree with the insurer’s or broker’s decision on processing your claim, a complaint can be made through the insurer’s or broker’s internal complaints handling process.
If this process is not satisfactory, you can refer your complaint to the Financial Services and Pensions Ombudsman (FSPO) which has a statutory function to help resolve consumer complaints.
Q. What are Insurers doing to support Businesses?
Insurance Ireland members are continuing the rollout of forbearance measures to help business customers following the Government’s decision to continue with Level 5 Covid-19 restrictions. Some of the measures, but not an exhaustive list include;
- Insurers will reduce premiums for business customers to reflect reduced level of exposure as a result of Covid-19 restrictions for Employer’s Liability / Public Liability (EL/PL) and Commercial Motor.
- Insurers will allow up to 28 days after renewal for payment.
- Cover will be maintained for unoccupied commercial buildings/ premises not in use due to Covid-19 restriction (max. 90 days). Appropriate supervision and security of the premises is required.
- Insurers will support requests for a change of property use during the crisis for business impacted by Covid-19 restrictions.