Business Interruption – Claims Information

Dear Member

Thank you for bearing with us as we discussed with the Supporting Insurers the evidence required to establish a case of Covid-19 being at the premises for cover to be afforded and a claim to be submitted.

Supporting insurers have now agreed that satisfactory proof of any of the following will be accepted as evidence that a staff member or visitor who was at the premises between the 5th and 26th March 2020 had symptoms:-

  • Staff sickness record
  • GP sickness certificate
  • Self certification for absence from work
  • Log of a call to GP to report symptoms/seek advice
  • GP entry in medical records to confirm symptoms and duration and advice given
  • Log of a call to NHS 111 to report symptoms/seek advice
  • Admission to Hospital with Covid-19 symptoms
  • Positive Covid-19 test result (albeit testing may have been very limited in March 2020)
  • A signed witness statement confirming symptoms, length of symptoms and duration of illness period, details of length of absence from work, return date to work and medical assistance sought together with supporting evidence.

You do not need to provide evidence of all of the above; if you produce satisfactory evidence of one, that will suffice.

If you are able to produce evidence to support a case at the premises, please send details to [email protected] so we can process your claim and then seek further information from you regarding financial losses.

AIM’s guide to the Hardening Insurance Market

We are aware of the financial issues that many of our Members are still facing. At the time of writing, we will also be familiar with the new dates for easing of the lockdown and hope that this brings comfort that businesses can start to reopen and once again our Members can provide their much-needed activities.

Unfortunately, over the last 12 months the insurance market has hardened considerably and some insurance customers are finding that prices have increased across a range of different covers.

What is a ‘Hard Market’?

A hardened insurance market usually affects customers in the following ways:

  • Higher insurance premiums
  • Fewer insurers
  • Reduced choice of products
  • More restrictive cover

What causes a Hard Insurance Market?

Like other financial markets, the insurance market also changes depending on supply and demand.  The insurance market usually follows a cycle which fluctuates between a hard market and a soft market. There are many factors that can lead to changes in the insurance market.

Even before the COVID-19 pandemic, several underlying market factors were contributing towards the insurance market hardening, including:

  • extreme weather events such as Storm Dennis and Ciara affecting property claims
  • interest rates staying low
  • a general rise in insurance claims (particularly in the home and motor insurance sectors)
  • changes to the Ogden rate, the rate used to calculate future losses in high value compensation claims, which also have an impact on the levels of compensation payments made to claimants.

When coupled with pressures arising from the COVID-19 pandemic, these factors have inevitably reduced insurers’ appetite for offering extensive cover or charging low premiums.

How is AIM Supporting Members?

AIM is doing all it can to provide the best, tailored, cover for Members, at the most competitive price, because we fully appreciate that many of our Members continue to face ongoing financial difficulties.

Therefore, when your renewal is due, the team will ask you to provide up to date information on your business so they can provide your quotation and ensure that it is accurately meeting your needs.  This will include details of your annual turnover and wage roll figures and any other information about the activities you provide.  If you are no longer offering or providing a particular activity, please let the team know as you don’t need to be paying for cover you no longer require.   We will always try to be as competitive as possible on prices so please do chat to the team if you have any queries.

We are committed to providing the best service for our Members and if you have any further queries or feedback please do come back to us. 

Difference between Claims Made and Occurrence Coverage

We are often asked the question, “What is the difference between ‘Claims Made’ and a ‘Claims Occurring’?” when it comes to the types of liability coverage available in the market.

It is important to understand both types of cover to ensure you have the correct cover in place should a claim happen.

Claims Occurring

The simplest basis of liability cover is on a claims occurring basis, it protects you from any covered incident that occurs during the period of cover, regardless of when the claim is reported even if it is after the cover has lapsed or cancelled.

The usual general liability covers such as employers’ liability, public liability and product liability are normally on a claims occurring basis. If you are a Member of AIM, all these covers will be on a claims occurring basis.

Claims Made

Claims made coverage is slightly more complicated. It provides coverage for incidents that occur during the period of cover only if the claim is also made during the period of cover. As long as you continue to renew with the same provider the coverage will continue, once the cover is lapsed or cancelled the cover stops. However, this presents a problem to those who switch from a claims-made basis to an occurrence basis, or who stop buying coverage altogether.

Fortunately, most claims made covers provide coverage to claims that arise from events that take place on or after a specified date, called the retroactive date.

The retroactive date is extremely important for a claims made cover, and this is usually the date at which cover was first incepted. At each renewal the same retroactive date is carried forward.  If you decide to move providers you must make the new provider aware of the retroactive date and the new provider should carry forward the retroactive date from the previous cover and not use the first day of the new cover as the retroactive date. If the retroactive date goes back a number of years this will probably incur an additional cost with the new provider. Otherwise liability arising from activities prior to inception of the new cover would not be covered by the new provider.

It is important to note that a claims made cover can sometimes pay out in relation to claims made after the end of the period of cover – but only if your provider has accepted a valid notification of circumstances during the cover period.

We would recommend to all of our members when moving from a provider who deals on a claims made basis to one on a claims occurring basis that members send the previous provider a copy of their accident book. This ensures that you have made the provider aware of all circumstances known to you before lapsing the cover with them.

Should you be cancelling the cover as you are no longer operational consideration should be given to the purchase of ‘run off’ cover. This will cover claims after the lapsing or cancelling arising from activities occurring prior to lapsing or cancelling.

Examples of covers normally on a claims made basis are Professional Indemnity and Abuse. If you are a Member of AIM these covers will be on a claims made basis.

We hope you found the explanation useful, should you need any further information or wish to discuss the matter further please contact us on 01892 888423.

Another Liability Claim Successfully Defended

Another liability claim successfully defended – but not without legal costs

This claim for damages arose from an accident which occurred during a coasteering activity on the Abereiddy Beach on the Pembrokeshire coast on 13 September 2008. The group members were invited to slide down a smooth two metre slab of rock, and it appeared that the claimant landed awkwardly and caught her foot on a projecting piece of rock at the foot of the slide, fracturing her right ankle in a shallow rock pool. Following a complaint by the injured party to the Licensing Authority on the appropriateness of the slide where she broke her ankle, the handling of the accident by the instructor and the after-incident care, an AALA complaint investigation inspection took place on 14th November. The report concluded that, whilst acknowledging that the 1-to-10 ratio had been exceeded (it was 1 to 12), the slab looked innocuous enough and the others in the group had completed the slide without incident, and that the immediate first aid and summoning of help was carried out adequately.

However, the claimant’s solicitors, MWR Solicitors of Preston, couldn’t wait for the AALA report and issued a letter of claim on 2nd December 2008 alleging that, inter alia, the provider exposed their client to a foreseeable risk of injury and failed to provide an experienced instructor. And they continued to press their case subsequent to the AALA report.

The wheels of justice turn slowly and in this case very slowly. Proceedings were issued in September 2011, four days before the three year limitation (or deadline date) and served in January 2012, seven days inside the further four month extension deadline and the case finally made it to the Southend County Court for the hearing on the 6th and 7th February 2014, before being adjourned to 23rd May for the judge to consider further written submissions.

Eventually, five years and two hundred and sixty nine days after the accident, the Circuit Judge ruled that the claimant’s injury was “a true and unavoidable accident for which the defendant should not be found liable”, a judgment pretty much consistent with the conclusions of the original AALA Complaint Report of some five and a half years earlier.

Although, subsequent to the ruling, AIM was entitled to recover its full legal costs from the losing claimant, as ever recovery didn’t turn out to be straightforward. So, following the “bird in the hand” principle, we accepted their offer of part payment to close the account, unfortunately leaving AIM some £22,500 out of pocket.

As a post script, following the Jackson reforms (see AIM Newsletter 2013), introduced last year to curb legal costs, we, as defendants, have forfeited our ability to recover any of our costs from the losing claimant’s side. In exchange for that, the claimant’s solicitors are no longer able to double their charges as “success” fees and bill us, and are no longer able to recover the cost of their ATE (after the event) insurance which covers their costs in the event that they lose.


Lessons Learned – Location, Location, Location

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Lessons Learned – Common Sense Prevails

Common sense prevails in Court following a slip in a mining museum

Judge rejects claimant’s premise that because he slipped and sustained an injury on a visit to a heritage site, the site owner is to blame, and that it must have been due to “an act or omission by the defendant which it should reasonably have remedied”.

Clearwell Caves, a long standing member of the mutual, is a natural cave system which has been extensively mined for iron ore and operates now primarily as a mining museum, also providing caving activities. The caves are part of a Natural England designated Site of Special Scientific Interest.

This was a case brought by a retired publican who had slipped or stumbled and fallen whilst on a family visit to see the cave’s Christmas Fantasy Display. Although the claimant’s injury seemed slight at the time, it subsequently transpired that he had sustained a broken right ankle, from which he has made a more or less full recovery after 12 weeks in plaster.

The accident occurred in an underground passageway on a slight incline. Taking into account the damp conditions, the surface was covered by compacted ragstone gravel, recently replenished, providing a suitable non slip surface with drainage channels down each side. As is required by the Mines Inspectorate, there are recorded inspections of the mine’s walkways at least three times each day at no more than four hourly intervals.

The claimant’s expert, a Mr Petherick, argued that the mine, which is subject to Health and Safety at Mines Regulations 1993 and 1999, should also be subject to the Building Regulations and legislation covering buildings and constructed public places, such as sports stadiums and supermarkets.

The judge ruled that it was incorrect to equate a mine, with its inherent and unique character, with a supermarket or an office and that building regulations do not apply. He found that the ragstone gravel did indeed provide a suitable non-slip surface for the walkway in dry or wet conditions and that the mine’s recorded inspection and maintenance regime was systematic, regulations compliant and effective.


Common sense prevailed here in Court. Even in a case of little apparent merit, documented records evidencing risk assessment, good management and a regular inspection and maintenance regime are required to counter a claimant’s argument that because there’s an injury, the facility is to blame and compensation is due.