Trade associations representing hospitality businesses have demanded an urgent meeting with insurers.
In a stern letter to the Association of British Insurers, representatives of the beer and pub sector noted how the “collective failure of insurers to step up and meet their obligations has been deeply disappointing”.
Hospitality businesses have arguably been hardest hit by the pandemic and subsequent lockdown. This week the government announced five new ministerial taskforces that will develop guidelines to help closed sectors reopen safely; one of these will be dedicated to the pub and restaurant sector.
On Sunday, the prime minister Boris Johnson, said parts of the sector could begin to reopen in July. Some might not survive that long.
Government support through furlough schemes (which have been extended until October) has been welcome but trade associations are becoming increasingly frustrated with the lack of support from insurers.
Only 1% of UK hospitality businesses, 3% of British Institute of Innkeeping members and 4% of British Beer and Pub Association members have received a positive response from their insurer following the Covid-19 lockdown.
“In normal circumstances this would be unacceptable, in this crisis it is frankly deplorable and threatens business survival for thousands of pub businesses,” the letter reads.
Steve Alton, chief executive of the BII said: “Barely any of our pub businesses have had their insurance claims successfully processed. Whilst we welcome the fact that the Financial Conduct Authority is seeking legal clarity, further action is needed now if we are to safeguard pub businesses.”
A UKHospitality sector survey, published last month, found that nearly three-quarters (74%) of businesses including pubs and restaurants have claimed, or intend to claim, on policies for business interruption due to enforced closures
“Hospitality was the first hit, the hardest hit and will suffer for the longest, and government support needs to reflect these facts,” UKHospitality chief executive Kate Nicholls told MPs recently.