Covid-related business interruption insurance claims could reach €430m
Insurance Ireland says €62m in claims have been paid out to customers to date
FBD said in late February it had set aside €65 million of provisions for claims and expenses arising from a landmark Covid-19 business interruption pubs test case ruling earlier that month.
Business interruption insurance claims arising from the Covid-19 pandemic are expected to amount to €430 million, according to an estimate from industry group Insurance Ireland.
The organisation said its forecast could potentially underestimate the total number of likely claims.
Some €62 million in claims had been paid out to customers to date since the crisis began last year, it added.
More than 9,000 business interruption claims have been received, of which more than a third have been accepted. A further 1,222 are being assessed while 3,264 did not have cover. Some 1,462 claims were withdrawn by customers.
“The Covid-19 pandemic is unprecedented in its impact and will be one of the biggest insured events of recent times. These latest estimates demonstrate the support that Insurance Ireland members expect to offer their customers as a result of business interruption insurance-related claims across a wide range of policies. This data was collected from individual firms by Insurance Ireland in recent weeks,” said Moyagh Murdock, chief executive of Insurance Ireland.
Ms Murdock said the organisation recognised that the pandemic had illustrated some “uncomfortable gaps between what people expected to be covered for and what their policy was designed for”.
“We need to learn lessons from this unprecedented event and redouble our efforts to improve consumers’ understanding and trust in insurance products,” she said.
“We also understand that this is a very difficult time for businesses and that business interruption insurance is a cause of concern in the marketplace. It is a very complex issue but most policy wordings are clear in terms of what cover is provided and what exclusions are in place.”
FBD said in late February that it had set aside €65 million of provisions for claims and expenses arising from a landmark Covid-19 business interruption pubs test case ruling earlier that month. It put the total cost at €150 million settling claims from more than 1,000 pubs affected by the ruling, but most of it will ultimately be picked up by reinsurance companies that shared the risk.