Glasgow business owner demands insurance firm pays out for Covid-19 lockdown
Alan Dexter believes wording in Hiscox's policy suggests his restaurants should be covered
Last updated 14th Apr 2020
A Glasgow business owner is taking on an insurance firm refusing to pay out for the coronavirus shutdown.
Alan Dexter runs several restaurants in Princes Square in the city centre. He believes while other insurers have covered themselves against a pandemic, a loophole in Hiscox's terms means they're liable for the cash.
In the conditions stated by Hiscox, they confirmed that they will consider these claims under the extensions of "Non-damage Denial of Access" and "Public Authority".
However, in the public authority extension, it states that you are covered if you are unable to use the venue due to restrictions imposed by a public authority during the period of insurance following an occurrence of a notifiable human disease.
Alan believes this does not state the disease must happen at the restaurants and says many other business owners are also joining the fight against Hiscox.
Alan said: "The whole point of this insurance claim is to ensure the safe passage of our business and ensure we can open once the government restrictions have been lifted.
"The insurance money would be necessary to cover costs in the interim and even after we get open to ensure the business is as strong as possible and we can carry on with our full employment because all of our staff have been put onto the furlough pay.
"There's a Hiscox Action Group been formed for Hiscox insurance policy holders - the more people that come on board to this action group, the more chance we have of forcing the insurance company to do the right thing and pay the policy which is evidently and quite clearly due to be paid by them."
We now understand a letter has been sent to the Secretary of State for Business, Alok Sharma, urging him to investigate the insurance company "as a matter of urgency".
In a statement, Hiscox said:
"We understand that these are incredibly difficult times for businesses affected by Covid-19. At Hiscox we strive to pay claims that are covered by the policies we issue fairly and quickly. However, general business interruption policies across the industry, including Hiscox’s, were not designed to cover the extraordinary circumstances caused by this pandemic.
"Most Business Interruption policies are intended to cover loss of income resulting from property damage caused, for example, by fire or flood. In certain cases, they also offer limited cover related to situations that don’t involve damage, but these covers are designed to respond to incidents where you can’t access your property due to a localised event, such as a crime requiring an investigation or an occurrence of Legionnaire’s Disease which requires the policyholder to notify the local authority and shut access while it is professionally cleaned.
"The government’s decision to impose social distancing preventative measures to stop the spread of Covid-19 across the country is not directly aimed at limiting access to an individual business’s premises, or any particular business premise. Like terrorism and flood, which have government-backed insurance schemes, pandemics like coronavirus are simply too large and too systemic for private insurers to cover. That is why the Government has brought forward the Coronavirus Business Interruption Loan Scheme for small businesses.
"We take all feedback very seriously and if a customer would like to discuss their circumstances with us, we’d ask them to get in touch."
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