Hospitality insurance specialists NDML and the Night Time Industries Association (NTIA) represented 72 claimants in securing Covid-19 business interruption claims from insurer Hiscox.
Policyholders have received an average settlement of just under £73k and will receive the full amount with no administration or legal fees deducted.
Most of the claimants were hospitality and late night economy businesses who had been subsequently closed from March to date, including pubs and nightclubs.
Claims were based on a range of policy wordings, from Covid cases emanating from the premises or a particular vicinity around the venue, accessibility and Government closure due to a communicable disease, The Morning Advertiser (MA) understands.
There are more claims still to be finalised between the NDML and the insurer so the total £5.2m figure could rise, thanks to the representation of leisure industry specialist barrister Philip Kolvin QC.
Back on its feet
NDML managing director, Simon Mabb praised the “team effort” that had gone into the result.
“The hard work has paid off, and I’m really pleased to see our policyholders receiving some of the highest business interruption settlements following Covid-19, thanks to the trust they placed in us from the very start," he said. "We’re now all looking forward to seeing the industry get fully back on its feet and forge a path to recovery.”
Nightclubs will be able to reopen on Monday 19 July after more than a year of enforced closure amid the pandemic.
Businesses were left in the lurch by insurers last year when the pandemic hit as they were told they would not be covered because of the national lockdown.
However, a Supreme Court court test case by the Financial Conduct Authority (FCA) found that several policy wordings would mean businesses were eligible for a claim.
Hospitality insurance specialist Steven Swift of Sector Associates said coverage of the ruling led many to believe they could receive a payment for lost income as a result of the Government ordered shutdown of their business.
“[The ruling] was supposed to have provided a lot of clarity, I think it has provided a little more confusion if I’m being honest," he said.
“I think in the mainstream media how it was reported led people to believe they were automatically getting paid which was plainly incorrect.”