Insurers must act quickly to compensate customers and rebuild trust says Insurtech UK

It is important for insurers to act quickly to pay any outstanding claims following the Supreme Court appeals ruling on 15 January, which backed commercial policyholders over business interruption (BI) claims.

This is according to trade body Insurtech UK, a spokesperson said: “The Supreme Court ruling is very interesting since it overturns quite a bit of case law that pre-existed, which could have far-reaching ramifications into how products are developed in the future.

“A huge amount of money has already been paid out by the insurance market for Covid and this court case relates to quite a small part of the overall impact. This is after all, ‘a once in a century event’, which took everyone by surprise and has really tested existing insurance process and laws.”

Rebuilding trust 

The trade body believes that the insurtech sector will play a “vital role in the years to come” in helping to rebuild consumer trust in insurance.

Insurtech UK continued: “The rebuilding starts today. It’s also important to stress that since there were a large number of types of policy wording that were reviewed by the court, that not all were agreed to via this ruling, so customers with outstanding claims will need to check which category they fall into.

“It’s inevitable that customers will feel let down by insurers and this will not have helped the brand reputation of the market.”

Clarity

Meanwhile, Instanda’s chief executive and founder Tim Hardcastle said that the ruling brings to light a broader issue that the industry has been grappling with for some time.

This is “how to ensure clarity in policy wording and avoid ambiguity or misinterpretation”.

He continued: ”Clear and simple communication around policies should not just be a ‘nice-to-have’, it should be a given.

“The measures announced by the Supreme Court are a positive ruling for SMEs. The government has had to finely balance the economic support it offers out to businesses so this can only come as huge lift for those who will benefit.”

Agreeing with Insurtech UK, Hardcastle said that the Covid-19 pandemic has also highlighted the need for the insurance industry to digitalise.

“The Covid-19 pandemic more generally has brought to light the desperate need for digital transformation of the insurance sector. Insurers must embrace modern agile technology and digitise their business as they seek to adapt to changing customer demands not just now, but also in the future,” he said.