StockMarketWire.com - General insurer Hiscox said it had reduced its payout estimate for business interruption claims owing to the Covid-19 crisis to 'less than £100m' following a court ruling on the matter.

The high court of England and Wales, in a complex 162-page judgement, found that insurance companies must accept some insurance claims by businesses forced to close by the pandemic.

Hiscox said the judgment clarified that fewer than one third of its 34,000 UK business interruption policies may respond.

'As a result of the judgment, the group estimates additional Covid-19 claims arising from business interruption to be less than £100m net of reinsurance,' it said.

'This encompasses claims from all divisions including Hiscox Re and is a reduction of £150m from the upper end of the group's previously published risk scenario.'

Hiscox said coverage under the policies was essentially limited to those customers who were mandatorily closed by government orders, and then only in certain circumstances.

The company said it was assessing the judgment in detail to ascertain how it should be applied to the claims and circumstances of individual policyholders.

Hiscox also said that it had delivered a 'resilient performance' in the third quarter so far, as trading conditions continued to improve in every segment. Gross written premiums, it said, had risen 19% in July and August on-year.

The test case had been brought by Britain's Financial Conduct Authority.

'Hiscox recognises these are extremely difficult times for businesses and regrets any contract dispute with customers, which is why it is committed to seeking an expedited resolution through this industry test case,' Hiscox said.

'In line with FCA guidance, Hiscox will communicate an update on the industry test case to relevant policyholders through the appropriate channels.'




At 1:40pm: [LON:HSX] Hiscox LTD share price was +129.8p at 888p



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