On 15 May, the FCA said as a result of a large number of claims being made to insurers under the terms of BI insurance policies, it wanted to hear from insureds and intermediaries who are in dispute with their insurers.
Airmic shared its own 12 May position statement with the FCA and added the following comments:
With many corporates facing an existential threat from global governments’ lockdown measures and a deep recession likely to follow, we expect brokers and insurers to demonstrate fairness and flexibility with regards to claims and renewals. The harsh market is already straining relations with many corporate clients, and insurers’ rigid interpretation of wording regarding the pandemic could accelerate this deterioration.
Airmic members believe insurers have a choice. They can either interpret ambiguous contract wordings with their balance sheet in mind, or they can act as partners to long-standing customers who seek business protection. All parties will benefit from a partnership approach to the current crisis.
The Association also highlighted that members had called for seven important actions. These include the avoidance of last-minute and poorly communicated changes in underwriting policy, constructive dialogue in wording disputes, flexibility in cover and rebates for reduced risk exposure and a commitment to avoid COVID-19 exclusions on Directors & Officers policies.
For more information on how the FCA is engaging with policyholders and insurance intermediaries on business interruption (BI) insurance, click here.