The law firm that represents the Hiscox Action Group has commenced an arbitration against Hiscox Insurance for non-payment of business interruption insurance totaling £40 million ($50 million).
The action group, composed of disgruntled Hiscox policyholders, is represented by London law firm Mishcon de Reya, which wrote today to Hiscox to trigger the arbitration clause in nearly 350 policyholders’ contracts.
“We were only appointed two months ago and have moved incredibly swiftly to get to this point. We know that many of our claimants are small businesses who desperately need this money to survive and we are pushing as hard as we can to help them,” said Richard Leedham, the Mishcon partner who is handling the action, in a statement.
“We can confirm that we have received a letter on behalf of a group of policyholders with UK property insurance policies. We shall carefully consider it and respond accordingly,” commented Hiscox in response to the abritration announcement.
Hiscox is one of eight insurers taking part in a UK court test case, which was filed by the UK Financial Conduct Authority (FCA). The FCA aims to get business interruption insurance policies examined by a UK court in a test case in order to provide “clarity and certainty for everyone involved in these BI disputes, policyholder and insurer alike,” explained the regulator on June 1.
“We understand these are difficult times for businesses, and we are paying claims that are covered by the policies we issue fairly and quickly. We welcome all proposals to expedite resolution of any dispute, which is why we have agreed to participate in the FCA’s expedited court-based process, and we will work with all parties to achieve this,” said Hiscox.
Hiscox and other insurers claim that their property business interruption policies contained exclusions for the risk of pandemic.
“Today’s launch of the expedited arbitration claim marks an important milestone in our campaign to force Hiscox to do the right thing and honor its obligations,” said Mak Killick, co-founder of the Hiscox Action Group in a statement accompanying the arbitration announcement. “It will be interesting to see if Hiscox is now willing to work with us to swiftly resolve this issue or if it seeks to delay things even further.”