The SNP’s Shadow Chancellor (pictured) has urged the UK Government to work with and support the insurance sector to ensure claims raised by policyholders as a result of the Coronavirus crisis are dealt with fairly and swiftly – including providing financial support.
Many policyholders have expressed confusion that whilst insurance should exist to protect against the unknown, the majority of infectious disease cover extends to infections like smallpox – certified as eradicated in 1980 – rather than new viruses.
The sector has no legal duty to pay those with insurance policies explicitly excluding pandemics or communicable diseases, therefore the SNP is urging that the UK government provide clarity that where there are no explicit exclusions, insurers should pay out.
The Financial Times Editorial Board highlighted that some insurers have moved swiftly to tighten up the wording of terms and conditions to exclude COVID-19 from policies starting this month – prompting questions about whether they felt their previous policy terms made them liable.
The MP for Glasgow Central raised this matter with the Chancellor in a letter dated 20th March but has yet to receive a response.
Commenting, Alison Thewliss MP, a member of the Treasury Committee currently looking into this issue, said:
“The Coronavirus crisis is affecting all aspects of life and, whilst I understand the vital importance of a solvent and functioning insurance market, insurers also have a moral duty to provide all reasonable support to firms and households making claims as a result of the outbreak.
“It is understandable that many policyholders are confused over whether their insurance policy covers claims as a result of Coronavirus.
“I am therefore urging the UK Government to set out guidance that makes clear that where there are no explicit exclusions, insurers must pay out, and that financial support must be made available to allow them to do so.
“It is shocking that some insurers have quickly tightened up the wording of their terms and conditions to exclude COVID-19 from policies starting this month – another important issue that the UK Government must address in any guidance it sets out.”