FCA has updated on its progress towards its test court case on business interruption insurance policies. It has now reviewed around 500 policies from 40 insurers, and has identified 17 policy wordings that capture most of the key issues FCA considers could be in dispute. 16 insurers use at least one of the wordings, and FCA has entered into a framework agreement with 8 of them to participate in the test case.
After initially approaching 56 insurers, FCA is now consulting on draft guidance that asks all insurers to check their policy wordings to see if theirs will be impacted by the outcome of the case, and sets its expectations on how firms should handle BI claims and related complaints before the outcome of the test case. It plans to publish a list of all relevant insurers and impacted wordings in early July.
FCA notes that:
- some insurers have already decided to accept claims on policies that include particular wordings that had been in dispute; and
- it received over 1,200 submissions from policyholders and brokers in relation to disputes.
FCA has now published, alongside the draft guidance:
- a representative sample of terms;
- proposed assumed facts;
- a proposed issues matrix and
- proposed questions for determination by the court.
It is inviting comments on all these by 3pm on 5 June. Therefore, it plans to file the claim form on 9 June, with a view to the court hearing happening in the second half of July.