Insurers must pay small Southport firms for Covid lockdown losses

Small businesses in Southport are set to receive insurance payouts covering losses from the first national lockdown, following a court ruling.

The Supreme Court found in favour of small firms receiving payments from business interruption insurance policies.

For some businesses it could provide a lifeline, allowing them to trade beyond the coronavirus crisis.

The ruling could cost the insurance sector hundreds of millions of pounds.

The City watchdog, the Financial Conduct Authority (FCA), brought the test case, with eight insurers agreeing to take part in proceedings.

One of the insurers set to make significant payouts is Hiscox, which was challenged by 30,000 policyholders as part of the case.

Richard Leedham, who represented the Hiscox Action Group – on behalf of small businesses, said: “This is a landmark victory for a small group of businesses who took on a huge insurance player and have been fully vindicated.

“What is important now is that Hiscox accepts the Supreme Court’s verdict and starts paying out to its policy holders, many of whom are in danger of going under”.