2 October 2020

Statement on NSW Appeal Court hearing of the Insurance Council’s business interruption test case

Statement attributable to Andrew Hall, CEO, Insurance Council of Australia:

Today the Full Bench of the New South Wales Court of Appeal, sitting in Sydney, heard legal argument in relation to a business interruption test case lodged by the Insurance Council of Australia (ICA).

The test case was initiated and fully funded by the ICA to examine the threshold issue of the application of certain infectious diseases exclusions in business interruption policies.

The case, which was prepared after consultation with the Australian Financial Complaints Authority (AFCA), consists of two separate small business claims that were lodged with AFCA as part of its dispute resolution process. The claims were volunteered by two insurers to assist the industry in clarifying the application of pandemic exclusions.

The industry argued that the intention of pandemic exclusions in commercial property policies that contain business interruption cover is clear.     

The ICA is pleased the Court of Appeal has been able to hear the case on an expedited basis and looks forward to a swift determination. The case is an important step towards providing greater clarity to customers, insurers and regulators in the treatment of pandemic-related claims.



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