Despite claiming it had policy wordings excluding pandemics in 95% of its policies, Aviva announced that it has had to pay out business interruption claims that came through brokers, which didn’t necessarily carry over the exclusion. This will be a relief to many businesses and potentially offer a boost to the broker channel in terms of a rise in consumer confidence, according to GlobalData, a leading data and analytics company.
GlobalData’s 2019 UK Insurance survey found that Aviva was the second largest SME business interruption insurer in the UK, with a market share of 7.1%. Furthermore, 45.2% of UK SMEs purchased business interruption through brokers, making it the largest channel by a considerable margin, and Aviva could have a significant number of policies to payout on.
GlobalData insurance analyst, Ben Carey-Evans, commented: “It is unclear whether that a mistake by Aviva or just a benefit of using a broker, but it will greatly help the channel retain customers, who otherwise may have lost trust in the industry.
“The confusion surrounding payouts in business interruption insurance across the entire industry is likely to benefit brokers once the pandemic is over. SMEs will be scarred by potentially not paying out when they would have been expecting to. While this may result in retention rates falling, many businesses will feel as though they simply cannot afford to go without business for another extended period of time, for whatever reason. Many business are, therefore, even more likely to seek out expert advice to ensure they find the most suitable cover, and they understand exactly what they are and are not insured for.”
If you would like to find out more, please send your questions to Rebecca Panks, PR Executive at GlobalData (email@example.com)