Insurers expect to pay £2bn for COVID-19 business interruption claims, the Association of British Insurers (ABI) has revealed.
A further £477m pay-out is predicted for life insurance, income protection, travel and general claims.
The data was collected from individual firms by the ABI in mid-late January.
Huw Evans, ABI director general, said: ‘The COVID-19 pandemic is unprecedented in its impact and will be one of the biggest insured events of recent times.’
In January, the Supreme Court clarified whether certain clauses commonly used in business interruption policies would pay out for policyholders affected by the pandemic, in a test case brought by the Financial Conduct Authority, FCA v Arch & Ors [2021] UKSC 1. This opened the gates to payment of claims for tens of thousands of small business owners.
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