High Court rejects Business Interruption test case appeal application

The High Court today denied the Insurance Council of Australia’s application to appeal a judgment in the first test case on business interruption claim denials arising out of COVID.

In short, the decision is important for any business trying to seek business interruption insurance as a result of the pandemic. The decision to deny the special leave application solidifies the NSW Court of Appeal’s decision last year that insurers can’t rely on exclusion wordings citing the Quarantine Act and subsequent amendments to deny claims for COVID-19 related disruptions.

There is a second test case yet to be determined through the Federal Court of Australia. The second test case is expected to be heard in September with any appeal likely to be considered by November this year.

These cases are fundamental in determining how insurers are going to assess claims for business interruption going forward. As this is major component of many business’ insurance portfolio, we are eager to see how these test cases will impact on the greater issues of business solvency as we continue to feel the effects of the COVID19 pandemic now more than a year since it started.


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