Active BI claims may be eligible for a second claim as a result of new Level 5 restrictions

Irish business owners with active Covid-19 related business interruption (BI claims) with “Territorial Limits” may be eligible for another claim in light of the recent Level 5 restrictions imposed by the government on 21 October 2020.

As part of Ireland’s “Plan for Living with COVID” Level 5 restrictions, non-essential retail and non-essential services have closed, while bars, cafes, restaurants and wet pubs can offer take-away and delivery services only (with the exception of Dublin where wet pubs remain closed).

Hotels, guesthouses and B&Bs are only permitted to remain open to support the provision of essential services. Weddings may only cater for up to 25 people as well as 25 mourners are permitted at funerals.

It is planned the restrictions will be in place for six weeks.

As a result of the lockdown, many businesses will once again be affected by the government-imposed closures as they were in March 2020 when the initial lockdown was imposed.

Business owners will therefore welcome news that they may be eligible for a second claim for BI insurance if they have already lodged a claim with “Territorial Limits” as a result of Covid-19 restrictions.

Example of eligibility for a second claim

Consider the example of Mrs Murphy* who owns a busy hair salon on the high street.

Like many other salon owners, she rents her premises, has several full-time staff, has to cover usual business costs such as hair products, insurance, light and heat, and also repays a small monthly loan to the credit union that was taken to cover her start-up costs. In addition, as a result of the coronavirus, she has to cover considerably higher cleaning and sanitisation costs than she did in 2019.

The financial burden of the lockdown was devastating to her business back in March 2020 however thanks to the Business Interruption policy she had taken out in December 2019, she was eligible to lodge a claim to cover her financial losses.

Now, as Ireland deals with a second lockdown and the hair salon is obliged to shut once more, Mrs Murphy is entitled to lodge another claim against her policy to recoup the losses of this most recent lockdown.

Are you eligible for a second BI claim?

Second time claimants must show their current policy was taken before 1 March 2020, prior to the first government-imposed lockdown in Ireland.

Provided your policy is current and your renewal has not taken place before the latest lockdown, you may be eligible for a second BI claim.

This should provide certain policy holders with some relief, while others await the verdict of the four test cases taken against FBD over its refusal to settle claims for COVID19-related business closures. The judges’ decision will provide clarity around the disputed language in insurers’ policy terms and determine whether FBD will pay-out policy holders’ Covid-19 related BI claims.

If your business has been closed as a result of the latest Level 5 restrictions, you might be eligible to make another claim for BI insurance. Get in touch with a member of our team today who can provide you with further details about making a second claim.

*Fictitious name used for example purposes only.

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