The FCA test case

The Financial Conduct Authority (FCA) has brought a test case aimed at resolving contractual uncertainty around the validity of many business interruption claims in relation to COVID-19. The FCA has sought a judgment from the High Court in respect of the interpretation of a representative sample of non-damage business insurance policy wordings which, subject to any appeals, will become binding on the insurers that are parties to the test case. It is important to note that the claims / complaints of individual policyholders are not under consideration as part of the test case.

The trial for the test case took place before the High Court over eight days during the last two weeks of July and was heard by Lord Justice Flaux and Mr Justice Butcher (the Judges).

At 10.30am on 15 September 2020, the High Court formally handed down its judgment and a copy has been published to the FCA’s website at The Judges have ruled in favour of the FCA in relation to the Argenta policy wording which was subject to the test case.

Now that the judgment has been handed down, the parties must wait for a consequentials hearing, at which time the Judges will make certain declarations in respect of their judgment and will likely also address the parties’ rights of appeal. The date of the consequentials hearing will be fixed shortly with the High Court and is expected to take place in October 2020.

Further details of the test case, and all the steps taken by the FCA in respect of the test case, are available on its website. On 17 June 2020, the FCA published its finalised guidance that sets out the FCA’s expectations for insurers when handling claims and complaints relating to relevant non-damage business interruption policies during the test case. We continue to follow that guidance pending the final resolution of the test case, being that time when the Court has determined the questions in the test case and after all rights of appeal have been concluded.

Further information on Argenta Syndicate Management Limited’s (ASML) approach is set out in the FAQs below.

Timetable of proceedings

A summary of the important dates for the test case are set out below.

09 June 2020 The FCA initiated proceedings in the High Court
16 June 2020 The Court fixed the timetable for the case and other procedural matters at the first case management conference
23 June 2020 Insurers filed their Defences
26 June 2020 Second case management conference
03 July 2020 FCA filed its Reply
20-23 July and
27-30 July 2020
Test case was tried over 8 days at a court hearing before Lord Justice Flaux and Mr Justice Butcher
15 September 2020 The High Court handed down its judgment
At a date to be fixed with the High Court, likely in October Consequentials hearing to take place before Lord Justice Flaux and Mr Justice Butcher, at which time the Judges are expected to make declarations concerning the judgment, as well as addressing the parties’ rights to appeal


Keeping you informed

We will continue to post details of key developments from the test case on this page, with the next update expected around the time of the consequentials hearing to detail any further information about a potential appeal.

For customers affected by the test case, we have previously contacted you directly to confirm how your claim / complaint may be impacted by the test case and to provide you with updates on the test case more generally. We shall write to you again following the consequentials hearing, assuming by that time more is known around the parties’ rights to appeal.

You may wish to register for email updates from the FCA on the progress of the test case on its website.

The Financial Ombudsman Service has issued its own guidance on business interruption insurance and Covid-19, which is available on its website.



Page last updated on 15 September 2020