Yesterday, 1 April, John Glen, Secretary of State for Business, Energy and Industrial Strategy, told the House of Commons that the majority of businesses would not have purchased cover for business interruption caused by Coronavirus.
Answering a question from Caroline Lucas MP, Glen responded "The Government is in continual dialogue with the insurance sector about its contribution to handling this unprecedneted situation"
He added "It is important to note that most businesses have not purchased insurance that covers loss from unspecified notifiable diseases, such as Covid-19. Some policies cover losses arising from any disease notifiable by the Government, however most policies only cover a specific list of notifiable diseases."
Glen reiterated the message that businesses that did not have pandemic cover would need to be supported - but not through their insurance.
He stated "The Government recognises that businesses that do not have appropriate insurance cover will require support from elsewhere.
"As such, businesses should explore the full package of support set out by the Chancellor in the Budget, on 17 March and on 20 March, which includes measures such as business rates holidays, the Coronavirus Business Loan Scheme and wage support."
The Minister then went on to detail how insurers will support businesses with valid claims. He stated "For those businesses which has an appropriate policy that covers Government ordered closure and unspecified notifiable diseases, the Government's social distancing instructions are sufficient to allow businesses to make a claim against their insurance, provided the other terms and conditions within their policy are met.
"The FCA's rules require insurers to handle claims fairly and promptly: provide reasonable guidance to help a policyholder to make a claim and appropriate information on its progress; not reject a claim unreasonably; and to settle claims promtly once settlement terms are agreed".
This statement to the House of Commons clarifies the rather misleading statement given by the Government in its daily Coronavirus update of 17 March.
Ian Mantel, Director of Manor Insurance, stated that they are actively seeking to contact their clients who did take unspecified notifiable disease cover to help them enter a claim. However he confirmed that policies which offered just liability cover do not include any business interruption element and reminded clients that business interruption cover is only included if you have cover for your business premises or the contents of your business premises.