Concerning the interpretation of the Coronavirus on policy wordings

The Coronavirus was confirmed as a pandemic by the World Health Organisation on 11 March 2020. As of 16 June 2020, deaths in the UK attributed to the Coronavirus stood at 42,153.

Attempts by certain world leaders to revert back as soon as possible to the so-called position before the onset of Coronavirus have simply failed. We are now all resigned to the fact that it is what it is and we have to deal with it. Other pandemics have come and gone. This will take its time and may involved mutations along the way.

The doctors look for the right medication. The lawyers debate the wordings to ascertain the extent to which insurance applies. The truth is that there are a multiplicity of policies that could be affected by the Coronavirus. That said, in earlier blogs, the efforts of the FCA in seeking some consensus of view from the High Court on certain generic Business Interruption wordings has been deservedly commended as has the position of the eight or so insurers whose own views on coverage will also be aired in such High Court proceedings in mid-July 2020.

Diverse policies are not going to be consistent as to what coverage (if any) they achieve. Moreover, only those close analyses of specific policies complete with policy exclusions will do the trick as to the determination of coverage. The FCA initiative is absolutely a good thing. It may be that judicial discernment will assist with generic policy interpretation but this may be limited. The old chestnut of whether you need material damage to substantiate a business interruption claim could well do with some judicial eyes and views. But as a Webinar by 39 Essex Street Chambers recently brought home to me, the devil is in the detail and much turns on the issue of causation.

The world is a rapidly changing place. The idea of a reinsurer of last resort is being contemplated in the UK. If there was such reinsurance, would its coverage extend to both pandemics and cyber risks which surely together reflect the greatest fears for us all?

Important: This blog is not intended to be relied on. It is merely a rough outline of the issues as they stand. It is not a substitute for legal advice which interested parties should seek promptly if in any doubt as to what action they should take.