Important updates regarding COVID-19 Business Interruption Cover

LAST UPDATED: 19/11/2020


Understanding your Insurance policy

At times like this, understanding your insurance policy is essential. Understanding what you are covered for is just as important as understanding what you’re not covered for. While your insurance arrangements with Guild are specific to your individual circumstances and profession, following is some general information to bear in mind during this COVID-19 pandemic.

 

 

NSW Court of Appeal Test Case findings


What were the findings of the case?

The NSW Court of Appeal recently delivered a judgement in a test case relating to business interruption insurance – specifically whether insurers can enforce policy exclusions referencing the Quarantine Act 1908 (Cth) rather than the Biosecurity Act 2015 (Cth) in relation to COVID-19.

The NSW Court of Appeal ruled that exclusions with reference to the Quarantine Act 1908 (Cth), rather than its replacement the Biosecurity Act 2015 (Cth) cannot be enforced by insurers in relation to COVID-19.

Your Guild Insurance policy does not contain an exclusion referencing the Quarantine Act 1908 (Cth), so the court's decision has no material impact on you.

 



Why was there a court case – was Guild taken to court?

No, the case was not specifically about Guild’s policies or exclusions. The test case was initiated and fully funded by the Insurance Council of Australia to provide clarity on the application of such infectious disease exclusions in relation to Business Interruption across the entire Australian Insurance industry.

The case was prepared in consultation with the Australian Financial Complaints Authority (AFCA), as part of its dispute resolution process.



What does this mean for my policy?

The NSW Court of Appeal judgement has no material impact on the cover available to you under your Guild Insurance Policy. The Court's judgement means only that insurers cannot enforce policy exclusions referencing the Quarantine Act 1908 (Cth) in relation to COVID-19 induced losses.

Your Guild Insurance policy does not contain an exclusion referencing the Quarantine Act 1908 (Cth). Under your policy, subject to the application of other: relevant exclusions, industry test cases and/or other legal processes, cover may be available to you if:

  • COVID-19 is identified at your business premises; AND
  • As a result of this happening, your business premises is ordered to close by a competent government or other statutory authority.

Please note that both conditions must be present. For example, a customer or staff member has attended your business premises and subsequently tests positive for COVID-19 and as a result, your local Health Authority orders your business to close for the purposes of deep cleaning.



Is this decision final?

The recent NSW Court of Appeal judgement has no material impact on the cover available to you under your Guild Insurance Policy. However, we anticipate further legal processes over the 2021 calendar year which will provide greater clarity on the cover available to businesses who have suffered loss of income related to the global COVID‑19 pandemic.

Guild will be in a better position to consider individual claims at the conclusion of these proceedings. We will provide communications at this time if we believe your circumstances may be impacted by these proceedings.

 



Will my claim be finalised now as a result of this decision?

The recent NSW Court of Appeal judgement has no material impact on the cover available to you under your Guild Insurance Policy or any claim for COVID-19 induced loss of income.

We anticipate further legal processes over the 2021 calendar year which may affect your claim. We will be in a better position to consider your claim once the result of these proceedings are known.

Unfortunately given the circumstances, we are not currently in a position to give an expected timeframe for these decisions.

Please do not hesitate to contact your Account Manager, or a Customer Care Specialist by calling 1800 810 213 if you would like to discuss any of the above options. 



I have been financially impacted by COVID-19. Are support measures available?

Guild are committed to assisting our customers, especially those experiencing financial hardship through the COVID-19 crisis. We are providing a range of relief and support measures on a case-by-case basis. 

 



Is my policy changing?

On renewal, all Guild Insurance policies now include an exclusion that means Business Interruption cover does not exist when an infectious disease is defined as a listed human disease under the Biosecurity Act 2015 (Cth).


For further information on support measures offered by insurers in relation to COVID-19, please visit the Insurance Council of Australia’s FAQ page here

Please do not hesitate to contact your Account Manager, or a Customer Care Specialist by calling 1800 810 213 if you would like to discuss any of the above options.

 

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