UK declares COVID-19 a notifiable disease for insurance compensation

Following public pressure, the British government has changed its stance to enable organisations to trigger insurance coverage for coronavirus-related losses in England. It said it would declare coronavirus as a 'notifiable disease' - a formal classification required by several insurance policies.

"To mitigate the impact on businesses, we will register COVID-19 as a notifiable disease. This will help companies seek compensation through their insurance policies in the event of any cancellations they may have to make as a result of the spread of the virus," said the Department of Health and Social Care on 3 March as cited in a BBC report.

The other parts of the UK –Scotland, Northern Ireland, Republic of Ireland – have already included coronavirus in their notification process which confers important powers to local authorities and acts as an important trigger for business interruption cover. According to an Association of British Insurers (ABI) spokesperson, commercial insurance policies provide cover against a wide range of risks that can be tailored to the needs of individual businesses, including extensions to cover. 

The association also noted that it may be possible to buy consequential business interruption cover for notifiable diseases as an extension to a business insurance policy, subject to any policy terms and conditions. “Standard business insurance policies are designed and priced to cover standard risks, not those that are very unlikely such as the effects of COVID-19. More generally, all UK insurers are capitalised under Solvency II to withstand a wide range of severe events, including pandemics,” said ABI.

Local businesses had earlier been warned that expected coronavirus losses risked not being covered under existing rules. They were also unclear whether their insurance policies would offer financial protection. ABI advised businesses who are concerned about this to check the scope of their cover and speak to their insurance adviser or broker – implying that the government's decision was unlikely to apply retrospectively.

Protecting citizens

UK Prime Minister Boris Johnson also announced statutory sick pay would be available to workers staying at home with possible coronavirus infections from the first day of illness. He said payments would be moved forward from the fourth day of sickness under current rules - under emergency legislation to stem the spread of the disease.

"Nobody should be penalised for doing the right thing," he said. The same day, 36 new people tested positive for the virus, bringing the total up to 87. The Department of Health said three of the new cases in England contracted the virus in the UK, raising fears that community transmission may now be taking hold.

The government and health officials are currently attempting to contain the spread of coronavirus and hope to push the worst of an outbreak into the summer months, when there is less pressure on NHS services. Ministers are considering bringing retired doctors back to work in the event of an epidemic. Several medical staff have in recent weeks tested positive for the virus.

England’s chief medical officer Professor Chris Whitty told Sky News that a serious coronavirus outbreak was ‘almost certain’, with ‘some deaths’ expected. He said that Britons may be required to take "more extreme action" in the longer term, but he does not believe people need to change what they are doing in terms of their normal behaviour. Prof Whitty highlighted a six-week window before the spread of coronavirus could accelerate.

"If we get established transmission in the UK, which I think at this time is more likely than not, then there will be a number of weeks - about six weeks - until we start to see a significant amount of transmission in the UK," he said. "The key thing is we will need to do a variety of interventions, but we do not want to do them too early because we'll then need to sustain them through the epidemic. "So, what we're trying to do is plan to do them at exactly the right point to minimise social disruption but still manage to reduce the impact of this epidemic."

Source: Asia Insurance Review