Pharmacy Daily | Time to talk BI claims with brokers

PHARMACY owners whose businesses are being impacted by the ongoing COVID-19 pandemic are being urged to talk to their insurance brokers following a ruling by the High Court of Australia on Fri.

The High Court announced it would not grant leave to appeal an NSW Court of Appeal test case ruling in Nov 2020, which stated that where pandemic exclusion wording references the Quarantine Act 1908 in a business interruption (BI) insurance policy, it cannot be used to exclude cover.

Pharmacy Insurance specialist, Carollo Horton and Associates CEO, Giuseppe Carollo, said the decision will affect up to 250,000 and an estimated $10 billion in claims.

"Pharmacies are in a unique position as they were able to trade throughout most of the pandemic with some restrictions, whereas industries such as hospitality and entertainment had to close down some or all of their operations," he said.

"It means pharmacies will need to be aware when claiming for BI, that there will be more complexity in preparing the claim and having it approved."

Carollo noted that while ongoing legal proceedings and a second industry test case are awaiting a decision later this year, pharmacies that have policies that reference the Quarantine Act will need to wait until issues concerning the interpretation of BI policies are resolved before it is clear if they will be fully covered.

"Pharmacies who want to lodge a claim should discuss this with their insurance broker," he said.

"The broker is there to guide you through the process and assess your claim against your policy, the circumstances and how your pharmacy traded during the period.

"We understand this is difficult not having the certainty around these decisions but pharmacies who believe they have a claim for business interruption should start the process with their broker."

Carollo encouraged pharmacy owners and managers to contact their insurance brokers if they need clarity over how the High Court ruling affects their policies in relation to BI from the pandemic.

He added that BI insurance policies where an exclusion references the Biosecurity Act 2015, are not affected by the NSW Court of Appeals and High Court rulings.