Insurers ordered to pay out for business interruption

Thousands of pubs and other small businesses finally have a reason to be cheerful, after the Supreme Court found in favour of SMEs receiving payments from business interruption insurance policies.

In a unanimous decision by all five law lords, the court rejected every one of the insurers' appeals. The ruling is a massive boost to around 400,000 SMEs, which the Financial Conduct Authority say were impacted by the insurance industry’s refusal to pay out on Covid-19 cover. 

The British Beer & Pub Association (BBPA) has been very vocal and public in its support for the case to make insurers payout, as has UKHospitality.

A BBPA member survey back in May 2020 found that 56% of sector businesses had application for business interruption cover rejected. Separate research from the British Institute of Innkeepers in the same period found that just 3% of pub businesses had been successful in receiving a business interruption insurance claim.

“This landmark ruling is great news for pubs and brewers who hadn’t received payouts thus far," says Emma McClarkin, chief executive of the BBPA. "While our sector is far from out of the woods yet, this announcement helps resolve some of the uncertainty it has faced on insurance cover and is warmly welcome.”