FCA urges insurers to settle valid BI claims quickly

The Financial Conduct Authority has written a Dear CEO letter to insurers pushing them to settle valid business interruption claims swiftly and consistently.

Christopher Woolard, interim chief executive at the FCA, wrote: “The High Court judgment on the test case has brought greater clarity and certainty for all parties. It is critical that this results in insurers paying valid and successful claims in full at the earliest possible date to support business and consumers during the current situation. Where we see that insurers are not meeting the expectations set out here, we will use the full range of our regulatory tools and powers to ensure they do so.”

He continued: “It is important that insurers reassess and settle claims quickly, including making interim payments wherever possible on policies where the legal process is complete or the claim has been accepted in full or in part. This is consistent with the wider objectives of the FCA to support business and consumers during the current Coronavirus situation.

“We also expect all insurers to take a pragmatic, transparent and consistent approach to their interactions with policyholders over any remaining evidence that applies to individual claims, rather than these creating additional barriers or delays to paying valid claims. This includes evidence for proximity and prevalence for ‘disease’ coverage clauses.

“In the coming weeks, we will publish additional information to help policyholders and insurers with the process of providing and assessing appropriate evidence on proximity and prevalence.”

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