Hiscox has agreed an arbitration settlement with a group of policyholders over business interruption losses due to the government’s COVID-19 lockdown last year, the Lloyd’s of London insurer said on Monday.
Hiscox was one of six of the world’s largest commercial insurers to lose a test case in Britain brought on behalf of policymakers by the Financial Conduct Authority.
Britain’s highest court said policyholders had a right to payouts from insurers who had argued many business interruption policies did not cover widespread disruption after government efforts to curb the virus from last March.
The judgment did not detail the size of the payments which insurers needed to make.
Hiscox said in a statement its settlement with the Hiscox Action Group of policyholders was “in line with the Supreme Court Judgment and the proceedings have now been resolved to the mutual satisfaction of all parties.”
The terms of the settlement were confidential, it added.
Hiscox said in March it had reserved $475 million overall for pandemic-related claims and that the insurer had suffered “brand damage” after the high-profile court case.
The judgment affects dozens of insurers with similar policy wordings.
The FCA said earlier this month that 757 million pounds ($1.05 billion) in interim or final payments had been made by insurers to policyholders so far.
($1 = 0.7194 pounds) (Reporting by Carolyn Cohn; editing by Iain Withers and Mark Potter)