Supreme Court Upholds Decision in FCA's Covid-19 Business Interruption Test Case

The Supreme Court has handed down its judgement today in the Financial Conduct Authority (“FCA”)’s business interruption insurance test case. The Court’s findings are substantially in favour of the policyholders.

Dated: 15 January 2021 Author: Emma Wallace, Forensics Director

The test case and appeal

The test case was brought by the FCA to clarify the areas of uncertainty around claims under business interruption insurance policies for losses resulting from the Covid-19 pandemic and Government lockdown.

The original decision by the High Court was handed down in September 2020 and the decision was appealed by both the FCA and an action group in support of policyholders, who wished to clarify the decision; and a number of insurers including Hiscox who sought to have the High Court decision reversed.

The Supreme Court has upheld the appeal of the FCA and the action group, and dismissed the appeals of the insurers.

Payouts now expected for many small businesses

The Supreme Court said that around 700 policies at 60 different insurers could be affected by the judgement, in addition to the policies reviewed as part of the test case.

Sheldon Mills from the FCA, which brought the case on behalf of policyholders, said:

"Coronavirus is causing substantial loss and distress to businesses and many are under immense financial strain to stay afloat. Today's judgment decisively removes many of the roadblocks to claims by policyholders.

We will be working with insurers to ensure that they now move quickly to pay claims that the judgment says should be paid, making interim payments wherever possible."

Take Action Now

If you require any assistance with your business interruption claims, Dains Forensic can help. Please contact Andrew Donaldson or Emma Wallace on 0121 200 7924 or email