French court rules insurer must pay restaurant owner Covid losses

A French court ruled last week that insurer Axa must compensate a restaurant owner for business interruption due to Covid-19 closures.

Many experts have said last week’s ruling, issued by the Paris Commercial Court, will be significant and spark similar legal challenges across Europe.

As reported by Reuters, the court stated that Axa must pay Stéphane Manigold, who owns four Paris restaurants including Michelin-starred Maison Rostang, two months’ worth of revenue losses incurred as a result of Covid-19 enforced restaurant closures.

Like many other insurance providers, Axa had argued that its policy did not cover business disruption caused by Covid-19.

Axa said it would appeal the court decision, however its chief executive, Thomas Buberl, said during a French radio interview that the company was seeking an “amicable solution” with Manigold, and that it would honour most of the claims from restaurant owners whose contracts had some ambiguity.

He added that these contracts “represent less than 10% of the total contracts with restaurant owners” and that he was “very confident” that a solution could be found.

Axa said it would be providing a further €500 million in financial aid for small companies, in addition to pre-existing plans for French insurers to invest €1.7 billion in domestic companies.

It follows news in the UK of the formation of the Night Time Industries Association (NTIA), a group of more than 200 companies, which intends to put pressure on insurer Hiscox to pay out unmet claims amounting to more than £50m. NTIA’s members include bar, club and restaurant owners whose premises have been closed by the lockdown, and who have closure insurance with Hiscox.

Insurers Aviva and QBE are also being targeted by a separate but similar group called Hospitality Insurance Group Action.

Read more:

PRESSURE MOUNTS ON INSURERS AS LEGAL BATTLES BEGIN OVER LOCKDOWN CLAIMS FROM UK ON-TRADE

VAGABOND WINES DENIED ‘VALID’ INSURANCE CLAIM FOR COVID LOSSES

MANDATORY ON-TRADE CLOSURE WILL NOT LEAD TO INSURANCE PAYOUT

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