Covid 19 - What you need to know - Financial Conduct Authority to seek Court Declaration.

On Friday (1st May), the Financial Conduct Authority (FCA) announced it intends to obtain a court declaration to resolve contractual uncertainty in business interruption (BI) insurance cover.

The range of wordings and types of coverage are sufficiently broad in the BI market that it is difficult to determine at a general level the degree to which any one individual customer may be able to claim.

The FCA therefore intends to bring relevant cases to court as soon as possible for an authoritative declaratory judgment regarding the meaning and effect of some BI insurance policy wordings where there remains unresolved uncertainty. The FCA are working to identify a sample of cases representative of all the most frequently used policy wordings that are giving rise to uncertainty, where it would be appropriate for us to bring such proceedings.

These declarations are likely to have significant impact for many businesses whose initial claims have been declined.

The action will not prevent individuals from pursuing issues through the courts, or taking eligible complaints to the Financial Ombudsman. If the FCA obtain a relevant declaratory judgment, the Ombudsman will be able to take it into account in considering relevant complaints.