New hospitality action group to help businesses receive insurance cover over covid-19

Jacopo Mazzeo

Jacopo Mazzeo

29 April 2020

New sector-wide action group Hospitality Insurance Group Action (HIGA) has launched today with the aim to help businesses against insurers who refuse to cover losses due to the covid-19 lockdown

HIGA is being advised by litigation law firm Mishcon de Reya LLP on the parameters of developing a collective group action against a range of insurers.

Any hospitality business that has been forced to close and whose current insurance contract includes non-physical damage extensions to cover are eligible to participate.

‘Hospitality sector businesses, large and small, have been particularly hard hit by the government-enforced closure during this pandemic and desperately need to mitigate their losses,’ commented Sonia Campbell, partner and head of the insurance disputes team at Mishcon de Reya LLP.

Hospitality sector businesses... have been particularly hard hit by the government-enforced closure during this pandemic and desperately need to mitigate their losses

Sonia Campbell, partner and head of the insurance disputes team at Mishcon

‘In times of crisis they expect their insurance to respond. Yet I am hearing time and time again that insurers are either stone-walling, unfairly limiting or simply point-blank refusing to pay out under business interruption policies. This strikes us as something that is open to challenge. I look forward to assisting all members of HIGA in exploring the possibility of a group claim. There may well be some light at the end of this industry’s very dark tunnel.’ 

There is no cost for UK hospitality businesses to register with HIGA at this stage, yet the action group highlighted that if ‘a claim is progressed and is successful, the third party funder is paid by taking an agreed deduction from any compensation secured at the end of the litigation. Most reassuringly, if the claim is unsuccessful, the litigation funder covers all legal expenses, so there is very limited financial risk to group members’. 

Hospitality business owners interested in joining HIGA should register their details online here for a free-of-charge preliminary assessment.

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