Walmsley on Business Interruption Insurance - Second Edition

Now in its 2nd edition, this guide to business interruption law has been fully updated to reflect recent relevant legal developments. Reference is made throughout to applicable case law and topics covered include:

• The underwriting process and loss adjustment
• the indemnity principle
• the schedule and extensions
• proximate cause, perils, exclusions and extensions
• gross profit, sum insured and uninsured working expenses
• variations on the basic forms of cover
• contribution and subrogation.

Preface to the Second Edition

It is 17 years since the first edition of this book, published in 1999, was written by Mr RM Walmsley ACII FCILA. Prior to the first edition, Mr Walmsley had acted as Education Officer of the Chartered Institute of Loss Adjusters for 9 years, writing several study guides and books including “Claims and Standard Fire Policies”, “Claims and Loss of Profits Policies”, “The Principles of Indemnity and its Application” and “Fire Insurance Law and Claims”. Mr Walmsley’s extensive experience in the insurance industry included working in an insurance company, an international firm of brokers and in loss adjusting.

In the light of the many developments in the law relating to business interruption insurance since the first edition, this new edition has required a complete rewriting of many chapters together with a thorough review of the overall scope of the book. As a result, the new book has fewer chapters but goes into greater detail in relation to the topics that are examined.

The most relevant changes in the law have been due to several first instance decisions of the High Court in London in the last 6 years clarifying certain critical aspects of business interruption insurance, starting with the case of Orient-Express Hotels Ltd v Assicurazioni General SpA (UK Branch) trading as Generali Global Risk [2010] EWHC 1186 (Comm). Naturally, the salient issues arising from the new Insurance Act 2015 are also dealt with, in broad terms, in this book.

The choice of the topics focused on in this edition has been influenced by the Report of the Research Study Group 265 published jointly by the Chartered Insurance Institute and the Chartered Institute of Loss Adjusters in 2012, entitled “Business Interruption Policy Wordings”. The overall emphasis in this book is also contextualised by my practice as a solicitor in the City of London specialising in high-value business interruption insurance losses, presently as a partner in the international law firm, Thomas Cooper LLP, as well as by my experience as a Committee Member and President of the London Business Interruption Association.

The purpose of this second edition has remained to provide a concise guide to business interruption insurance law and especially to tackle practical claims issues arising from the widely followed standard terms of the UK Gross Profit Form.

This book is aimed at all insurance industry professionals involved directly or indirectly in risk management, loss assessment, underwriting and claims handling.

This second edition is based on the law in force on 15th May 2016.

Dedication

Foreword

Preface to the Second Edition

List of Cases

List of Statutes

1. Underwriting Process and Loss Assessment

2. The Indemnity Principle

3. The Schedule and Extensions

4. Proximate Cause, Perils, Exclusions and Extensions

5. Gross Profit, Sum Insured and Uninsured Working Expenses

6. Clause (a); Gross Profit; Adjustments Clause; Special and Additional Clauses

7. Clause (b); Increase in Cost of Working and Additional Increase in Cost of Working

8. CLAIMS: Savings, Depreciation; Underinsurance and Material Damage Overlap Savings

9. Variations on the Basic Form of Cover

10. Contribution and Subrogation

Appendix A: Association of British Insurers Recommended Policy Wordings, Extensions and Clauses

Appendix B: Book Debts

Index

Celso de Azevedo

Celso de Azevedo (FCIArb) has over 20 years’ experience specialising in complex and high value international re/insurance, cyber and commercial disputes. He is also qualified as a New York Attorney and is a Fellow of the Chartered Institute of Arbitrators.