British Dental Association urges FCA to consider ‘unique challenges’ of dentists in BI claims test case

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The dentist trade union is arguing that the short timeframe given for its members to submit any relevant material to the FCA has meant that all issues could not be communicated

The British Dental Association (BDA) has urged the FCA to consider the specific plight of dentists in its legal process and test case assessing business interruption (BI) claims.

It made the plea in an open letter intended to provide further arguments to assist the FCA in its test case given the short timeframe that members had to submit material.

The BDA is a trade union and professional body which represents dental practices across the country, and it hopes its formal request to the FCA will provide further understanding of the specific challenges that facing the dentistry sector prior to the regulator taking forward a test case.

But the BDA is advising members to await the outcome of the FCA process before considering whether to pursue class action litigation, which appears premature at this stage and will not help to solve the cash crisis that members are facing now.

On 15 April, the FCA stated that most policies with basic cover would not insure Covid-19, but is now seeking legal clarity.

BDA chair, Mick Armstrong said: “The skeleton service now operating remains hugely vulnerable, operating a fraction of its former capacity while facing sky-high costs.

“The country and policymakers will be faced with a national dental health crisis if dentists do not receive the urgent support that they need now including the speedy resolution of whether or not the insurance companies will pay out.”

It follows limited face-to-face dental care resuming last week on 8 June in England, the BDA also issued an open letter to Matt Hancock last week calling for financial support.

Test case

The BDA instructed law firm Brown Rudnick LLP to review the wide range of business interruption policies held by members. This is to provide legal advice for the dental sector and set out in detail to the FCA the issues faced by the profession, asking the FCA to adequately reflect these in its own legal challenge.

Regarding the test case, the notes that very few of its members appear to be in the test case and that some of its members’ insurers will not be bound by the court’s declaration.

It listed six issues that must be brought to the court’s attention in the test case:

Public authority clauses and classification of the chief dental officer and Care Quality Commission (CQC): It states that some insurers have disagreed withs its members about the application of public authority clauses, and the test case in its current form will fail to determine whether the CQC and/or chief dental officer constitute relevant authority.
Whether closure amounts to restriction or prevention of access under policies: It is important for the test case to clarify the uncertainty on the existence of access to insured premises as required by public authority wording as well as questions over interpretation.
Whether a voluntary closure interrupts the chain of causation: The BDA said that some insurers have argued that a member’s decision to close their practice or limit care to the provision of remote advice only went beyond what was necessary and raises causation issues and possibly mitigation issues.
Evidential issue for clauses with a geographic area limitation: The BDA states that a significant amount of its member’s policies state a “25-mile radius” requirement in which a disease must occur.
Quantification of claims: One of the primary and ongoing concerns from BDA members is how they will return to full time practice and achieve pre-covid19 levels of business activity when the requirement of physical proximity in regards to infection profile to patients remains an issue. On top of this costs of PPE are sky-high.
Ambiguity in policy wording: For circumstances where issues 1-5 are material to BDA members’ claims against insurers, it is the trade association’s view that the FCA must pursue a further argument that ambiguity in policy wording must work in the favour of policyholders.

Physical proximity

The letter states that: “The BDA welcomes the opportunity to give representations in the test case given the number of dental professionals it represents and given the industry-specific impact Covid-19 and the associated public authority measures have had and will continue to affect the dental profession.”

It further explained that “due to the physical proximity required for dentists to diagnose and treat their patients and the environment in which they must operate, dentists have been disproportionately affected by the Covid-19 pandemic”.

This is because the BDA’s members are a “uniquely affected group” operating within the private sector who will continue to feel the economic impact in addition to the health and safety impact of Covid-19 for a significant period of time.

The letter added: “At a time of crisis, dentists looked to their business interruption policies, held with multiple insurers, for coverage in these unfortunate circumstances and have been unfairly let down for the reasons we outline in this letter.”

Short timeframe

The BDA said that insurers should not be permitted to argue that business interruption policies were never intended to cover a pandemic in the absence of an express exclusion.

Although the BDA said that it understands that not every policy can be reviewed by the court in the time available but it welcomes any further engagement from the FCA as to what approach insurers whose policies are not in the scope of the test case will be entitled to take following the court’s declaration.

The letter stated: “In short, the reliance on persuasive guidance for related but different policy wordings continues to present a material risk to our members and does not resolve the risk of future coverage disputes.”

The BDA also set out a list of actions and policy review:

BDA members have reported instances of insurers rejecting BI claims where wording was allegedly valid, different insurers treat the same policy wordings inconsistently and ambiguity in wordings being resolved against our members rather than against insurers.
A short time frame for the deadline for policy holders to submit relevant material to be submitted to the FCA has meant that the BDA has not be able to communicate all its members’ issues
The basis of these submissions is that BDA members are facing specific challenges which it feels has not been “adequately reflected” by the FCA
The BDA has completed its review of more than two dozen policies affecting the profession (and other healthcare providers) and set out its submissions and next steps

Sky high costs

There are approximately 42,000 registered dentists in the UK, with the BDA representing 18,000.

The BDA’s survey indicates as little as a third of practices have reopened, most at less than a quarter of their former capacity, leading to on-running risks to the sustainability of the sector.

Only 8% of respondent practices estimated they will be able to maintain their viability due to lower patient numbers and sky-high costs.

Meanwhile costs for personal protective equipment (PPE) alone for treating a single patient have increased by up to 6000%.

Last resort

Armstrong added: “We have set out to get the best possible holistic advice on the dozens of policies serving the dental sector and will be sharing the lessons from that with our members. The FCA needs to appreciate the unique challenges faced by dental practices.

“Lengthy litigation should remain a last resort and won’t keep practices afloat today. Our aim is to give our members the best possible understanding of their legal position and the FCA the best understanding of the dental sector.

“We want to see the FCA process lead to speedy resolution but for that to happen, the authority needs to appreciate and consider the particular impact of the pandemic on dentistry. We hope our submission achieves that in unequivocal terms.”