Insurance action group prepares to challenge Aviva and QBE over business interruption policies

By James McAllister

- Last updated on GMT

Hospitality Insurance Group Action prepares to challenge Aviva and QBE over business interruption policies Coronavirus

Related tags Insurance Coronavirus ukhospitality

The Hospitality Insurance Group Action (HIGA) has announced it is preparing to launch a group claim against insurers Aviva and QBE over unpaid business interruption policies.

It comes after the group's legal advisor, Mishcon de Reya, working in conjunction with Philip Edey QC of Twenty Essex Chambers, completed a review of over 500 business interruption insurance policies, submitted by applicants between 29 April and 6 May 2020. 

HIGA, which was set up last month​ to support hospitality businesses who are wrestling with insurers to secure payouts under their business interruption policies, says it is now writing to all its applicants, inviting only those policyholders who are with Aviva and QBE and have specified types of policy wordings to confirm if they remain interested in participating in a funded group claim.

It is is also inviting any business in the hospitality industry not already registered with HIGA, but which has sought to claim under its business interruption policy with QBE and Aviva and has thus far been 'ignored or thwarted', to join HIGA by registering here​.

"We were overwhelmed by the expressions of interest in bringing actions against insurers from within the hospitality industry – demonstrating how hard-hit this sector has been as a result of the government-enforced lock-down and how intransigent many in the insurance industry have been towards their policyholders," says Sonia Campbell, partner and head of the insurance disputes team at Mishcon.

"We are contacting those HIGA applicants insured by Aviva and QBE and inviting them to confirm their continued interest in participating in a group claim. 

“We also encourage any other business in this sector - with a specifically-worded business interruption policy underwritten by Aviva or QBE - to contact us by no later than Friday 5 June, should they wish to consider participating in HIGA’s group action.  We believe this is the best way to ensure some financial recompense for these policyholders following their sudden and enforced closure." 

Mishcon says it is in discussions with third party funders to secure funding for the costs of this litigation and expects to be able to move forward by Wednesday 10 June, with the aim of issuing a claim as soon as possible thereafter.

The ​action is one of several notable challenges being made across the sector against insurers for refusing to honour business interruption policies.

Last week, a joint letter​ was sent to the Association of British Insurers from industry trade bodies UKHospitality, the British Beer and Pub Association (BBPA), the British Institute of Innkeeping (BII), and the Society of Independent Brewers, demanding insurers to meet their obligations to the sector.

Meanwhile, a crowdfund campaign launched to challenge insurance companies that are refusing to honour business interruption policies specifically for the hospitality sector, has moved on to its next phase​ having surpassed its initial £20,000 target.

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