Publican Jim Gordon is “thrilled, absolutely thrilled” with Friday’s High Court ruling against insurer FBD over coronavirus closures.
FBD said on Friday it will make interim payments to “valid” business interruption claims under its pubs policy, after four publicans won a landmark court case against the insurer.
“It’s a happy day. I’m delighted to see the insurance companies pinned to the wall, they’ve had us pinned to the wall for so long,” Mr Gordon said.
His bar, Oskars, on the outskirts of Waterford city, is one of about 1,000 establishments affected by the judgment.
But his relief on Friday morning was tempered with the worry that “this payout could take years. Companies could go to the wall in the meantime”.
The other fear, he added, is that “we will pay for it down the road” with higher premiums or that the ruling might drive insurers out of the Irish market.
Policy
When the country went into lockdown in March, Mr Gordon contacted FBD, with whom he had a policy costing €14,000 a year. The policy included the so-called “25 mile” clause which proved crucial to the case, stating that a business is covered if the closure is caused by nationwide outbreaks of disease, where there is an outbreak within the 25-mile radius.
However, FBD replied that he was not covered. “I was advised by the Vintners’ Federation of Ireland to write a letter to my broker and my insurance company, stating that I want to make a claim against this policy for loss of earnings, because I’ve been closed by the Government due to a disease in my area.”
FBD responded again to say it did not believe the business was covered, but it would keep his case on file. He has heard nothing since, but kept a close eye on the case taken by four publicans in the meantime. “We’ve all been frustrated by how long it took.”
While they wait for the insurance payout to come through, “we still have overhead costs – phone lines, electricity, broadband and mortgages. So the loss of earnings has been substantial. Unless we open, and open quite soon, there are a lot of businesses going to go to the wall.”
Government supports mean “we’re getting 10 per cent of our net turnover repaid. But that doesn’t cover all my bills”.
He is hopeful, however, that the judgment will have knock-on implications for similar policies held with other insurers. Last week, the UK-based company which insures a second pub he owns, Revolution Bar in Waterford city, made contact to ask him to provide evidence of lost earnings.
