There is a risk that disputes over claims linked to the COVID-19 pandemic will lead to parts of the UK economy becoming uninsured, hampering a recovery, the Bank of England said on Tuesday.
Insurers are under the gun for not paying out on some claims from businesses interrupted by the pandemic, and firms could be less willing to insure themselves in future, said Anna Sweeney, executive director of the BoE’s insurance supervision division. “I do see a risk of a protection gap,” Sweeney said.
“The high profile of disputes over business interruption claims has done nothing to dent the popular caricature of an industry that is happier to accept premiums than to pay claims. This matters: it could have an impact on demand for policies.”