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Covid Business Interruption Update
Following the Supreme Court’s judgement on Friday 15th January, finding in favour of policyholders in respect of the Insurer appeal of the test case initially brought by the Financial Conduct Authority (FCA), we wanted to provide an update to our clients.
After reviewing the judgement, we anticipate that it will not alter the current stance of many insurers who have already rejected claims from policyholders.
For policyholders not with Ageas Insurance Ltd for their Practice Insurance we will review the policy wordings on a case by case basis and advise whether this judgement is likely to affect you.
We have made contact with Ageas Insurance Ltd on behalf of our policyholders for their formal response to the Supreme Court ruling and whether this impacts on Business Interruption claims related to Covid-19.
For further advice please do not hesitate to contact us on 0203 757 6950, or alternatively Ageas Insurance Ltd claims on 0345 122 3283 and quote your claims reference number.
The high court has today handed down its judgment in the Financial Conduct Authority (FCA) business interruption insurance test case. The Court found in favour of the arguments advanced for policyholders by the FCA on the majority of the key issues.
This decision is the first step along the process of deciding whether some, or all, insurers have any liability, but the final outcome is not conclusive at the moment because there are so many other variables between each policy type and each insurer.
It is a positive step for the industry and its customers in the search for clarity but we are still a long way from a conclusion for everyone and every policy.
We are monitoring the situation very closely and, where possible, insurers will be confirming where they stand on each claim submitted.
If you have submitted a business interruption claim and not heard from your insurer in the next 14 days please let us know and we will chase them for an update for you.
Can I return to practice? And will my indemnity insurance with All Med Pro cover me?
We are unable to advise whether you can or cannot return to practice.
However, it is important to understand the basis of your indemnity policy. Your policy provides coverage for negligence arising in the course of treatment. This coverage is subject to you following the guidance of your regulator and professional bodies.
Any claim or loss directly or indirectly due to any act, breach or omission you deliberately or recklessly commit, condone or ignore would be excluded.
To summarise coverage will be in place as long as you follow the guidance of your regulator, professional bodies and of course adhere to any other terms within your policy.
What about my Practice Insurance?
Under all insurance and indemnity policies the policyholder has an obligation to mitigate risk as much as possible in order to be covered should something go wrong. Therefore, when returning to practice we would expect each practice owner to follow the guidelines set out by the competent authorities in actively mitigating the risk within practice as much as possible.
Failing to follow the advice of all competent bodies and minimise all of the risks could result in the insurance policy being invalidated and a claim being repudiated.
Again, coverage will be in place as long as you follow the guidance of the regulators, professional bodies and adhere to other terms and conditions of your insurance policy.
As part of your risk management it is vital you check the inspection status of your pressure vessel systems. The HSE advice is that the overarching legal obligation remains. i.e. ensure that equipment is safe to use. If you require any assistance in arranging an inspection please contact us.
Quick-Funding Working Capital Facility Now Available
We have partnered up with Acorn Business Finance, who, in addition to being able to access the government funding schemes for you, are also able to secure funds from specialist lenders who can provide a lifeline to businesses that, had it not been for the Coronavirus outbreak, would otherwise be in a healthy, financial position.
The Acorn Working Capital facility is typically able to provide funds to you within 7 days of you completing the application form – thus ensuring you are able to meet your financial obligations such as rent/commercial mortgage payments, equipment finance and staffing costs (including dental associate fees).
COVID-19 – Questions and Answers
As is commonplace for many insurers in the UK and the dental sector our business interruption cover is based on a specified list of diseases. Unfortunately, like most insurers, COVID-19 is not a specified disease within the policy wording and as such business interruption cover would not apply to this new and emerging disease.
You can view the wording for the Business Interruption cover under section 10 Diseases, Poisoning,Vermin, Defective Drains. Murder or Suicide where it states that the policy covers ‘any occurrence of the following diseases, or discovery of an organism which causes the following diseases at thepremises:Acute Encephalitis, Acute Poliomyelitis, Anthrax, Chicken Pox, Cholera, Diphtheria, Dysentery, Legionellosis, Legionnaire’s Disease, Leprosy, Leptospirosis, Malaria, Measles, Meningococcal Infection, Mumps, Paratyphoid Fever, Plague, Rabies, Rubella, Scarlet Fever, Tetanus, Tuberculosis, Typhoid Fever, Viral Hepatitis, Whooping Cough, Yellow Fever
COVID-19 is not a disease or virus stated within the wording so is not covered.
All dental professionals, must by law, have an indemnity arrangement or insurance in place. Continuous cover is a must, and this is stipulated in the GDC guidelines.
This means the cancellation of a policy leaving you without on-going cover would mean you are in breach of the GDC guidelines.
At All Med Pro we understand that the next few months at a very minimum are going to be tough for everyone. We are all in this together! First and foremost, it is imperative that you keep cover in place. Where required our underwriting team will look at ways we can continue to provide you with indemnity coverage as well as supporting your individual needs.
As the ABI stated on the 16 March 2020:‘Irrespective of whether or not the Government orders closure of a business, the vast majority of firms won’t have purchased cover that will enable them to claim on their insurance to compensate for their business being closed by coronavirus.
We’re not currently aware of any other insurer that currently provides this cover. We have reviewed the BDA Plus policy which is provided through Lloyd and Whyte and underwritten by Zurich. The BDA Plus policy, we believe, has the most policies for dentistry in the UK in terms of Practice insurance and as such, is a good marker for what the dental and insurance sector are doing. This policy, like our policy only covers illnesses that are on the specified list in the policy wording and doesn’t include COVID-19.
In our experience, this would most likely be covered under a Practice Overheads policy. This type of policy pays a monetary benefit to the practice if the insured person is unable to work through accident or sickness. However actual sickness needs to be present; it is unlikely to operate for self-isolation of the insured person without the symptoms of an illness also being present. Please note that such an epidemic maybe excluded by certain policies.
Many insurance companies are now applying an exclusion for COVID-19 to their new business policies so it is highly unlikely that we will be able to secure a policy which provides cover.
Yes, we have partnered up with Acorn Business Finance, who in addition to being able to access the government funding schemes for you, are also able to secure funds from specialist lenders. Please contact us on 0203 757 6950 or Acorn Finance directly on 01242 395507 quoting All Med Pro, for further details on the scheme.
Most of our products and schemes have unoccupancy conditions that set out what cover will be maintained including; when that will be restricted, and what actions policyholders need to undertake.
if you have an All Med Pro Surgery Plus policy, where any premises become temporarily unoccupied as a consequence of COVID-19, we’ll not restrict cover from the time the unoccupancy starts, until such time as the restrictions on premises being used or occupied are lifted. This is subject to you applying appropriate best endeavours to manage your premises, including appropriate security measures while you are closed, and adhering to governmental advice and action.
You don’t need to notify us of the unoccupancy, where it occurs as a result of COVID-19.
This amended approach will apply for the next 90 days, from 24 March 2020. We may (subject to review) extend this period further if necessary.