In a separate case, meanwhile, bakery chain Greggs won a landmark ruling in its legal battle over its £150m insurance claim.
While insurers report they have already paid out more than £1.5bn pounds in compensation to thousands of businesses that had to close or restrict trading to curb the coronavirus, not all policy wordings were covered by the test case and, where they were, some businesses disputed pay-out levels, leading to further court cases.
Stonegate argued in a case against MS Amlin, Zurich Insurance and Liberty Mutual that its 760 insured pubs, bars and night clubs had each faced separate challenges in the pandemic, opening and shutting at differing times according to regional rules - and seeing business drop by up to 90% below projections.
Insurers accepted Stonegate’s businesses were covered by their policies, but said cover was limited to one business interruption payment of £2.5m, which had been paid.
There were just two separate events triggering business interruption payments, Monday’s judgement found.
In addition, Stonegate could not claim where losses were covered by government furlough payments, it said.
Stonegate will appeal some aspects of the case, a spokesperson said in a statement, adding the judgement was “far from conclusive”.
“We believe that the court’s interpretation on a number of issues which are generally applicable to policyholders is out of step with the approach taken by the Supreme Court in the test case and with the approach of courts in other jurisdictions,” the spokesperson said.
Meanwhile in the separate case, Greggs won a landmark ruling in its legal battle over a £150m insurance claim.
A High Court judge yesterday backed the majority of the company’s claim for business interruptions caused by the pandemic, in a move that could cost Zurich Insurance tens of millions more than it argued was its liability.
Lawyers for Greggs, which employs about 25,000 people across more than 2,200 shops in the UK, said that each outlet suffered some interruption or interference with trading as a result of government lockdowns imposed to combat Covid-19.
The chain claimed more than £150m on its policy with Zurich, arguing that it had suffered many instances of business interruption.
However, Zurich argued that all of the chain’s losses could be traced to a “single occurrence”, for insurance purposes, which would cap the bill for the insurer at £2.5m. In January last year the company said that it had discharged its obligations to Greggs after it paid the chain that sum.
Manoj Vaghela, a partner at Charles Russell Speechlys, the law firm representing Greggs, said the ruling had “wider implications for all businesses that purchased the resilience insurance policies”. The lawyer said Zurich’s argument “has been firmly rejected”.
Various Eateries also brought a case against Allianz, which the legal team which represented the restaurant company said resulted in a “win for policyholders”.