The insurance sector has issued a number of statements regarding the Government’s response to COVID-19.

The Association of British Insurers (ABI) has issued a statement. It read: “Irrespective of whether or not the Government orders closure of a business, the vast majority of firms won’t have purchased cover that will enable them to claim on their insurance to compensate for their business being closed by the coronavirus.

“Standard business interruption cover – the type the majority of businesses purchase – does not include forced closure by authorities as it is intended to respond to physical damage at the property which results in the business being unable to trade.

“A small minority or typically larger firms might have purchased an extension to their cover for closure due to infectious disease. In this instance an enforced closure could help make the claim, but this will depend on the precise nature of the cover they have purchased so they should check with their insurer or broker to see if they are covered.”

However, following this evening’s Government press conference, where the Prime Minister and the Chancellor commented that their advice to avoid certain venues is sufficient for businesses to claim on their insurance (where they have appropriate cover), the ABI felt it necessary to reiterate earlier comments. It said: “The Chancellor’s statement today is consistent with our statement this morning where we said in the event businesses have the right cover, this type of notification could help make a claim. But, as the Chancellor acknowledged, the vast majority won’t have purchased extended cover and this remains unchanged.”

Insurance companies are keen to work with the live music and events industry – artists, promoters, organisers and suppliers – to help them navigate such tough times. Much is dependent on the type of cover purchased and businesses will need to check the wording contained within their policies.

In the meantime, Tim Rudland, associate director, entertainment and sport at Tysers (formerly Integro), issued the following advice to those who are looking to reduce business overheads.

“Public and Employers Liability cover tends to be arranged on a minimum and deposit premium basis. The premium is then adjustable based on the estimated turnover and wage roll provided. We would normally contact clients prior to expiry of the policy cover for appropriate declarations and additional premiums become payable to the insurer when the estimates used to calculate your deposit premium are exceeded.

“In light of this, at renewal, we’re suggesting clients consider their turnover and wage estimates in the coming year as a result of coronavirus, as this will reduce their upfront premiums.

“I should point out that these figures should still be a reasonable expectation of their wage roll/turnover for the next 12 months.

“Clients would then pay a declaration at the end of the renewal based on actual figures if the turnover and wage estimates are exceeded, and hopefully then any additional premium due is more palatable as everyone is back in business and cash flow has returned.”