The Australian Financial Complaints Authority (AFCA) have approved the commencement of a second COVID-19 business interruption test case by the Insurance Council of Australia. The Federal Court of Australia will hear the case, consisting of nine small business claims lodged with AFCA related to insurance claims with Allianz, IAG, Chubb, Guild and SwissRe Corporate Solutions.
We recently wrote about the first COVID-19 business interruption insurance test case, which was determined by the NSW Court of Appeal and affirmed by the High Court of Australia. You can read our post about this case here
The Insurance Council of Australia has confirmed that the second test case will consider the meaning of policy wordings in relation to the definition of a disease, proximity of an outbreak to a business, and prevention of access to premises due to government mandates. The case will also determine how policies are affected by government financial support such as JobKeeper.
If you lodge a claim related to COVID-19 business interruption which relates to one of the issues that will be determined in the second test case, your claim may not be finalised until this case is determined.
The second test case trial is expected to take place in late August 2021, with any appeal expected to be heard in November 2021.
If you hold an insurance policy which may respond to losses suffered as a result of the COVID-19 pandemic, or your claim with respect to COVID-19 business interruption has been denied, call us today to discuss your options.