week commencing 19/07/20:

This week the news has been dominated by tales from the High Court. While the front pages are focused on Depp vs Heard, we’ve taken a closer interest in FCA vs insurers…

Business interruption case goes to High Court

The fate of many insurers and small businesses hung in the balance this week as Britain’s High Court began to consider the nature of Business Interruption (BI) cover for SMEs and its relevance to COVID-19. On the Sunday before proceedings commenced, the Financial Times called the issue ‘one of the most controversial to arise from the coronavirus crisis’. It also noted criticisms that today’s BI policies are still based around ‘Victorian concerns for factories’. External-link. [Financial Times]

On Monday it was reported that the 17 policy wordings being scrutinised were similar to those used by around 60 insurers in total, impacting 370,000 policyholders. External-link. [Reuters] According to External-link. [The Insurer], the FCA believes that insurers’ wordings do encompass ‘epidemic risk’, even if not designed to do so. On Tuesday, the regulators’ lawyers attempted to dismantle arguments that insurers are expected to rely on based on BI issues emanating from Hurricane Katrina and hotels External-link. [Insurance Age] and on Wednesday, lawyers for policyholders argued that notifiable disease clauses in some wordings responded to pandemics, even if insurers claimed they did not. External-link. [Insurance Age]

 Yesterday, the Hiscox Action Group attacked the way Hiscox construed clauses and interpreted words in its submission to the court. External-link. [Insurance Age] The case is scheduled to run for eight days with judgement expected later this year.

Munich Re confirms coronavirus losses

Munich Re has announced a Q2 2020 loss of €700m due primarily to the effects of COVID-19. The bulk of these losses, the reinsurer said, related to coverage for major events. The firm is dropping its share buy-back plan as a result. External-link. [Reinsurance News]

Swiss Re slips into loss

Meanwhile, Swiss Re has announced an H1 2020 loss of €1.1bn. The pandemic, it said, had led to claims worth €2.5bn across the group as a whole. External-link. [Insurance Day]

Beazley says H1 2020 “defined by coronavirus”

While we’re on the subject of coronavirus, Beazley has posted a pre-tax loss of $13.8m for H1 2020. The first half of 2020 was “defined by COVID-19 and claims arising”, the company said. External-link. [Insurance Business UK]

Whitespace gets full approval from Lloyd’s

Electronic trading platform Whitespace has been granted “fully recognised” status by the Lloyd’s of London market.  This places the platform on a similar footing to PPL. External-link. [Reactions]

LMG proposed Swiss trade deal

The London Market Group has proposed the framework for a free trade deal with Swiss (re)insurers that could be used as a template for future deals with other, third countries. External-link. [Commercial Risk Europe]

New analysis of syndicates’ performance

Syndicates that strive for consistent profit rather than targeting higher risk returns are the best performers at Lloyd’s over a ten-year period, an analysis of new data shows. External-link. [Insurance Insider]

EIOPA published new guidelines

EIOPA, the European pensions and insurance regulator, has published a number of supervisory recommendations for the way in which reinsurance schemes for COVID-19 and credit insurance will be recognised. External-link. [Reinsurance News]

Part VII transfers delayed

With Brexit looming, Lloyd’s has delayed the Part VII transfer date from October to December in order to give market firms as much time as is available to move affected policies to Lloyd’s Brussels. External-link. [Insurance Insider]

Do we need an office?

Tired of being stuck in the attic while juggling phones, laptops, piles of scribbled notes and the kids? Or does the idea of the return to the daily commute and office politics fill you with existential dread? Or is there a third way? The Harvard Business Review weighs up the pros and cons. External-link. [Harvard Business Review]

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