Business interruption test case moves closer to trial on 20 July

The second case management conference in the FCA business interruption insurance test case took place today. The court allowed groups of policyholders – the Hiscox Action Group and Hospitality Insurance Action Group – to intervene in the hearing and made other detailed orders about the management of the case during the three weeks before the trial begins on 20 July.

Representations by the policyholder interveners will be limited to 50 pages of written argument each and to 45 minutes of oral argument each, with such time to be taken from that allocated to the FCA at the hearing, given the broadly shared aims of the regulator and the groups.

Detailed orders were made about revisions to the agreed facts and skeleton arguments under which the latter should be available by 14 July at the latest and can be expected to be posted on the FCA website as has been the case with the other key documents to date.

The most controversial procedural point between the FCA and the eight insurers involved remains the issue of evidence or data about the prevalence of COVID across the UK and in local authority areas. The previous order from last week’s case management conference that there shall be no expert evidence on this still holds, but the FCA remains concerned that the test case should provide some prima facie basis by which insureds could prove particular BI claims based on the presence of the disease in their geographical location.

The court again raised the prospect of a second and separate trial on the prevalence issue should insurers be able to secure suitable experts on the point (a significant difficulty given that so many key experts are involved advising governments and institutions about how currently to manage the disease). It was made clear that if insurers seek to go down this route then it would need to be addressed at the outset of the trial on 20 July and any such report(s) would have to be disclosed to the FCA by the end of July.

It seems that the regulator is not at all keen for a second trial, given the delay, uncertainty and expense, but the court indicated that if absolutely necessary a second hearing of no more than two days could be arranged for September or early October. The FCA requested and was given a further 7 days to finalise its position regarding a second trial.

The hearing starting on 20 July will be a fully remote one and will be streamed on line (as was today’s) so as to be accessible to interested parties, members of the public and the media. The judge managing the case indicated that it would simply be impossible, even with the new social distancing standard of 1m, to find a court large enough to accommodate more than 30 counsel, their instructing solicitors and all the parties involved.


Alistair Kinley – Director of Policy and Government Affairs, BLM

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