When pubs, venues and hospitality businesses were forced to close almost overnight, insurance was meant to provide a financial safety net.
In that context, the Financial Conduct Authority deserves genuine credit for stepping in quickly, bringing the Covid BI test case, and delivering clarity across a wide range of policy wordings through both the High Court and the Supreme Court.
It was regulation at pace, and it mattered. Insurers broadly followed the rulings. Claims were paid and, for some businesses, that support proved critical.
But the hard truth remains that less than 10% of policyholders ultimately benefited from Covid BI cover. That was never the FCA’s intention.
Real risk
There is now a real risk that the positive legacy of the test case will be undermined as the Limitation Act takes effect in March 2026, shutting out claims before they are even properly examined.
For many policyholders, the real inflection point came later, following the litigation involving London International Exhibition Centre Plc (the ExCeL). That case has been widely recognised as a turning point in how disease cover—particularly “at the premises” wordings—should be interpreted.
It also underpins the recent joint letter to the FCA, calling for the Covid BI claims window to be extended by two years, which sets out clearly why an extension is now necessary, as set out by Stewarts Law.
Despite this evolving clarity, insurer responses remain inconsistent and opaque. Claims handling has often migrated to solicitors, with loss adjusters reduced to little more than post boxes.
Very few insurers have proactively contacted policyholders to explain that, in light of developments since the ExCeL case, they may now have a valid Covid BI claim. Instead, businesses are left to navigate complex evidential hurdles alone, while the clock continues to tick.
Relentless fight
This is why the work of sector bodies is so important. Organisations such as UKHospitality, the British Institute of Innkeeping, the British Beer and Pub Association, and the Music Venue Trust continue to fight relentlessly for their members.
They see first-hand a sector in crisis: rising costs, fragile balance sheets, and the cumulative impact of recent Budgets that have increased wage bills and business rates while offering little meaningful relief.
Nowhere is the imbalance clearer than with ‘at the premises’ wordings. Questions around evidence, date ranges and manifestation remain contested. Insurers hold all the cards: legal teams, policy wordings, counsel interpreting judgments, and detailed knowledge of what evidence has already resulted in paid claims—while also benefiting from the Limitation Act.
What realistic chance does a pub have, run by a landlord working punishing hours behind the bar, covering shifts to control costs, and worrying late into the night about how to absorb the latest Budget measures?
If MPs really are to be barred from their local premises, perhaps that absence will at least give them the time and space to look more closely at what insurers could do—right now—to genuinely help a sector still trying to recover losses suffered during Covid.
