“Like others in the industry, Hiscox UK’s core small commercial package policies do not provide cover for business interruption as a result of the general measures taken by the UK government in response to a pandemic.”
This was the reiteration made by Bermuda-headquartered Hiscox Ltd in a market update this morning, insisting that it is not paying out claims as a result of economic losses following mandated premises closure aimed at stopping the spread of the coronavirus.
The specialist insurer, however, has put forward an offer…
“A number of UK policyholders have disputed the application of their policy in relation to business interruption,” it stated. “Hiscox recognises these are extremely difficult times for businesses and is determined to help provide greater certainty for customers.
“As a priority it will therefore work with the UK insurance industry, its regulators, and its customers to seek means of expediting resolution through the range of independent mechanisms available.”
It’s unclear what “independent mechanisms” Hiscox was referring to.
Meanwhile, in a commentary piece published today, The Times banking editor Katherine Griffiths said the company risks having a serious image problem.
“Even if it is legally right, its customers may decide that its judgment is wrong,” wrote Griffiths. “That could be disastrous when customers renew their policies and decide whether to go with Hiscox, whose premiums tend to be much higher than those of rivals but come with a no-quibble reputation, or to try someone else.”
Referring to the policyholders, she also noted: “If their policy suggests from a simple reading that most things are covered, it seems fair to claim now. After all, customers have been paying their premiums all this time.
“It may be the case that, sadly for Hiscox, its policy wording was too loose and out of step with the rest of the industry. If so, that could come down to human error on the part of its underwriters. It is for Hiscox to prove otherwise.”
