04 May 2020

Coronavirus – Important Notice for Vista’s Guest House Policyholders (Accelerate/RSA)

These are incredibly challenging times for the whole world. We see unprecedented pressure on cafes, restaurants, hotels, B & B’s and Holiday Homeowners as the hospitality industry is hit harder than anyone.

Vista Insurance Brokers are extremely grateful for your loyalty and continued support as we do everything we can to support you with your insurance needs. Our renowned personal service continues, despite the lockdown, with your team here at Vista happy to provide guidance on renewals, mid-term changes and insurance claims. We are here for you when you need us most.

Your insurer RSA, as are many insurers, coping with an incredible volume of calls and communication from policyholders seeking clarification on their coverage and exploring the possibility of making a claim for lost business. RSA have made available the following guidance for Insurance Intermediaries:

Q. Will Business Interruption policies with RSA cover customers’ losses as a result of Covid-19?

A. In the majority of cases, standard Business Interruption policies will not cover losses arising from Covid-19, whether as a result of the presence of the disease on your Premises, or the Government enforced closure of businesses.

If a customer has purchased a Notifiable Disease extension, then this may provide cover for some losses, if the closure or restriction of the customer’s Premises is directly as a result of the discovery of Covid-19 at or, in some cases, within the vicinity of the Premises. The policy wording will outline this. If this applies to your customer, you should get in touch to discuss a claim.

Q. How does this relate to government announcement that businesses would be covered?

A. The Government’s announcement related specifically to policies with specific pandemic cover or specific pandemic extensions. If policies do include pandemic cover, insurers are not requiring an “enforced” lockdown to trigger business interruption terms. The government “guidance” that businesses should close is sufficient so long as other terms and conditions are met. However, there are very few pandemic policies or policies with pandemic extensions.

Pandemic cover is different from infectious disease cover, which is more common and is covered in the next question.

Q. How does the Government requirement that non-essential businesses close from 23rd March 2020 impact cover for these businesses?

A. Neither standard Business Interruption policies nor those with a Notifiable Disease extension would cover losses incurred by non-essential businesses after the wider Government restrictions, as those losses are not incurred as a result of an insured risk under the policy.

Customers who have a Business Interruption policy with a Notifiable Disease extension may however be able to claim for certain losses suffered after Covid-19 was declared a notifiable disease (5th March in England), but prior to the wider Government action to close non-essential businesses on 23rd March.

The Association of British Insurers (ABI) Chairman Huw Evans has said:

“This is an unprecedented event, and insurers recognise that it is a very worrying time for everyone. While many business owners are uninsured for pandemics, UK insurers still expect to pay over £1.2 billion in claims, making this a significant insured event. From paying all valid claims, to providing a range of extra help and support to customers, insurers are working hard to reassure and support policyholders through this uncertain period.

However, we are also painfully aware that the majority of businesses are uninsured for global pandemics, as is the case throughout continental Europe and North America. Although ABI members expect to pay £900 million in business interruption claims, most policyholders are not covered for pandemic losses. We agree strongly that the UK should examine public-private partnerships to find a lasting solution, to enable more affordable, more extensive pandemic insurance cover to be available to those firms who want it.”

Rest assured here at Vista we support the efforts of ABI and our member organisation the British Insurance Brokers Association in lobbying the Government and we continue to press insurers to help our clients, when cover is in place, to get their claim dealt with swiftly and equitably.

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