Pub owners in Ireland take FBD Insurance to court over Covid-19 disruption cover

Test actions brought by pub owners over whether their insurance policies with FBD Insurance Plc should cover the disruption in their trade caused by the coronavirus crisis have been admitted to the fast track Commercial Court list.

MR Justice David Barniville was told there could be as many as 1,000 pubs and bars in the country affected by the dispute which arose after the insurer refused to provide them with cover since the pandemic resulted in the closure of businesses in mid-March.

Pub owners have claimed that under their policies of insurance taken out with FBD, they are entitled to have their consequential losses covered by what they claim is an insurable risk.

They claim the insurance policy they have taken out with FBD has a clause that states the pub owners will be indemnified if their premises is closed by order of the local or government authority if there are “outbreaks of contagious or infectious diseases on the premises or within 25 miles of same.”

That interpretation is disputed by FBD, who in April informed the pub owners that a pandemic does not fall within the scope of the clause, they (FBD),  also consider that the closures did not occur as a result of an outbreak of disease at the premises or areas where the pubs are located.

The closures occurred as a result of measures taken at a national level that involved a nationwide closure of business.

All the pubs involved dispute FBD’s refusal to indemnify them, or its stance that the policy of insurance does not cover the Covid-19 pandemic, and claims that the insurer is acting in breach of contract.

In separate actions, the pub owners seek various orders and declarations including orders directing FBD Insurance Public Limited Company to indemnify the pubs in respect of the losses they suffered due to their closure following the outbreak of Covid-19.

The also seek declarations from the court including that the pub owners are entitled to an indemnity from FBD under the provisions of their policy of insurance in respect of claims they have made to the insurer.

Stephen Cooney a director of the company that runs the Leopardstown Inn, which employs 70 staff, said the firm is losing €56,000 per week since it closed.

Noel Anderson, a director of the firm operating the Lemon and Duke, said he feared that the business could lose in excess of €1 million.

The cases continue…