Judge holding gavel in courtroomThe latest instalment of the Financial Conduct Authority’s (“FCA“) test case on business interruption (BI) insurance took place last Friday, with a “consequentials” hearing that dealt with the effect of the judgment, ‘leapfrog’ certificates and an application from a proposed new party.

Outcome of the hearing

Declarations as to the effect of the Judgment

Various orders were made during the hearing by Lord Justice Flaux and Mr Justice Butcher, including a series of declarations as to the effect of the judgment.

The FCA will publish these declarations on its website as soon as they are available.

‘Leapfrog’ certificates

The High Court also granted ‘leapfrog’ certificates to various parties to the test case, which entitles them to apply to the Supreme Court for permission to appeal (by-passing the Court of Appeal). Those granted certificates include the FCA and Hiscox Action Group, as well as Arch Insurance (UK) Ltd, Argenta Syndicate Management Ltd, MS Amlin Underwriting Ltd, Hiscox Insurance Company ltd, QBE UK Ltd and Royal & Sun Alliance Insurance Plc.

Both Ecclesiastical Insurance plc and Zurich Insurance plc have chosen not to take part in the appeals process, after the test case found that the wording of their policies did not provide non-damage BI cover in relation to the outbreak of COVID-19.

Application from a new party

The hearing also dealt with an application from QIC Europe Limited to become a party to the test case in order to bring an appeal.

This application was rejected, with the High Court noting that any non-named insurers should have intervened in June, or requested at the time to be a named insurer. Non-parties would, however, have the option to apply to the Supreme Court for permission to intervene.


Following the hearing, the FCA has confirmed that it will decide on its next steps and review the final declarations. Next steps will include “pressing on with the application to appeal” and continuing its dialogue with insurers and action groups to seek a solution which would avoid any appeal and enable quick pay-outs on eligible claims.  It may be that the declarations provided by the High Court will have clarified the sticking points between the parties sufficiently to avoid the need for an appeal.

Insurers and policyholders will wish to keep an eye out for when these appeals are brought, in particular to see which grounds of appeal the parties will run.