November 26, 2020

Volume X, Number 331

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Insurance Companies Drop Appeal Against the London High Court’s Ruling in the FCA’s “Test-Case”

As we explained in our earlier post, in a decision that could influence how policyholders and insurers around the world address business-interruption coverage for COVID-19 losses, the London High Court recently handed down its much-anticipated judgment in the Financial Conduct Authority’s “Test Case,” The Financial Conduct Authority (FCA) v. Arch et al.  Because the judgment provided that coverage was available for COVID-19 business-interruption losses under most of the policy wordings at issue, it was highly anticipated that the insurance companies at issue would challenge the judgment in a fast-tracked “leapfrog” appeal to the Supreme Court of the U.K., expected to be heard by the end of the year.  Yesterday, however, six of the insurance companies subject to the judgment decided not to pursue an appeal in connection with some of the policies, and one of the insurers stated that it would instead begin to make payments where appropriate.

The insurance companies’ decision to drop the appeal marks yet another win for policyholders.  It shows first that coverage exists for business-interruption losses caused by the COVID-19 pandemic under business-interruption policies, thus belying the insurance industry assertions that such coverage “could not apply.”  In addition, it shows that insurers are now willing to pay for such losses in at least some cases, as opposed to litigating in court at the appellate level where they might risk bigger exposures.

Copyright © 2020, Hunton Andrews Kurth LLP. All Rights Reserved.National Law Review, Volume X, Number 296
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About this Author

Lorelie S. Masters DC Partner Insurance Lawyer
Partner

A nationally recognized insurance coverage litigator, Lorie handles all aspects of complex, commercial litigation and arbitration.

Lorie has advised clients on a wide range of liability coverages, including insurance for environmental, employment, directors and officers, fiduciary, property damage, cyber, and other liabilities. She also handles various types of first-party property insurance claims, including claims under boiler and machinery, business-interruption, contingent business-interruption, extra expense, disability and other related coverages.

Lorie has handled and...

202-955-1851
Scott DeVries Insurance Lawyer Hunton Andrews Kurth Law Firm
Special Counsel

An experienced trial lawyer, Scott routinely represents clients throughout the country facing insurance recovery issues, as well as in class and mass torts, product liability and complex civil litigation at both the trial and appellate levels.

Scott has more than 30 years of experience in high-value complex disputes for companies faced with major business litigation involving contracts, insurance rights and recovery, environmental claims and toxic torts/class actions. He has a nationwide practice, frequently appearing in court at both the trial and appellate levels, trying some of...

415-975-3720
Patrick McDermott Insurance Litigation Richmond VA
Counsel

Patrick counsels clients on all aspects of insurance and reinsurance coverage. He assists clients in obtaining appropriate coverage and represents clients in resolving disputes over coverage, including in litigation and arbitration.

During law school, Patrick served as a judicial intern for the Honorable Michael F. Urbanski in the US District Court for the Western District of Virginia and for the Honorable Ricardo M. Urbina of in US District Court for the District of Columbia.

804-788-8707
Associate *not admitted in DC

Jorge’s practice concentrates on complex insurance recovery disputes on behalf of corporate policyholders. He also counsels clients on risk management and insurance recovery strategy. Jorge has helped clients secure millions in insurance coverage under claims involving a wide variety of losses.

Jorge represents commercial and governmental policyholders in all types of complex insurance matters throughout all stages of the insurance process, from pre-purchase policy analysis and review through litigation and settlement of contested claims. Jorge has handled claims involving CGL, D...

202-419-2009
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