Mactavish questions impact of Supreme Court BI ruling

Consultancy Mactavish believes only a small proportion of the firms covered by the Financial Conduct Authority’s class action on COVID-19 business interruption losses will receive payouts as a result of the Supreme Court ruling.

The outsourced insurance buyer and claims resolution firm said the FCA’s case focused on a small sub-set of wordings and did not elicit a definition on what lockdown meant in practice.

The firm said insurers would still be able to dispute the grounds on which a business ceased trading and therefore, whether its business was interrupted by external factors beyond management control.

Bruce Hepburn, CEO of Mactavish, said: “As ever, the biggest victors here are the lawyers. Having limited itself to a small set of claims, and then having appealed on grounds that affected an even smaller number, the FCA has essentially failed in its mission to drive a quicker resolution for as large a number of firms as possible.

“The situation is akin to one in which the FCA has set out to rescue stranded passengers from a sinking ship. In a situation like that, we wouldn’t be celebrating, we’d be mourning the fact that most of them were still on board when it went down.”

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