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Law360, London (August 5, 2020, 3:46 PM BST ) Allianz's U.K. business said Wednesday it has paid out on 950 claims worth £14 million ($18 million) to companies forced to close during the COVID-19 lockdown, as the insurer awaits a High Court judgment over further claims.
Allianz Holdings PLC said in its results for the first half of the year that it expects a total £80 million hit from claims for business interruption as a result of the closure of non-essential shops from March, before the company seeks to claim on its reinsurance.
The company was the target of a planned class action in May, coordinated by law firm Edwin Coe LLP, over its refusal to pay out for claims made under policies on what it calls "material damage & business interruption – resilience," which are sold by broker Marsh.
That action was shelved after the policy was included among 15 others in a High Court test case brought by the Financial Conduct Authority.
A judgment in the City regulator's case is expected in September. A spokesperson for Allianz declined to say whether the amount it has paid out, or the total estimated hit, includes claims brought under the disputed policy wordings.
"The FCA test case is addressing a number of products — including Marsh material damage and 'BI - resilience' — and it would be inappropriate for us to comment further," the spokesperson said.
The company's operating profit rose to £179 million in the six months to June, surging from £86 million in the same period in 2019. The growth was the result of the integration of the recently acquired general insurance businesses of LV and Legal & General into the wider U.K. group.
"This set of results is broadly in line with our expectations, and has been achieved against the backdrop of an unprecedented human, economic and social crisis," Jon Dye, chief executive of Allianz Holdings, said.
The company said it has paid out £10 million in travel insurance claims. It has also paid £30 million in refunds to motor insurance customers as a result of drivers making fewer claims during the lockdown.
--Editing by Ed Harris.
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