The prolonged dispute over COVID-19 business interruption claims has moved from a matter of contract law into a documented account of Parliamentary alarm regarding corporate behavior.
While the High Court remains the venue for determining policy triggers, the House of Commons has become the archive for tracking how insurers—with NFU Mutual prominent as a defendant in the High Court—are managing their liabilities as a major legal deadline passes this month.
The Parliamentary Record of Concern
In addition to evidence provided to the APPG on Fairer Finance, there have been various parliamentry questions.
The following questions have been part of the business of the House of Commons, tabled by Helen Morgan MP.
Parliamentary Question |
Date Tabled |
Core Area of Scrutiny |
Implied Conduct Issue & Full Question Text |
| UIN 61020 | 18 June 2025 |
Progress on the FCA’s 2021 “Dear CEO” letter |
Failure to act with “speed and clarity” expected of an insurer treating customers fairly
Question: To ask the Chancellor of the Exchequer, what assessment her Department has made of the potential impact of the March 2026 limitation deadline on unresolved Covid-19 Business Interruption claims. Emma Reynolds, answered on 24 June 2025: The Supreme Court published its final judgment in the Financial Conduct Authority’s (FCA) Business Interruption Insurance test case on 15 January 2021. At the time of the judgment, the FCA set out its expectation that insurers should communicate to all impacted policyholders what the judgment meant for their claim and should move quickly to resolve claims as determined by the judgment. It is important to note that the FCA court case did not cover all potential issues with business interruption policies but aimed to provide certainty to as many policyholders as possible. Under FCA rules, insurers must treat customers fairly. For example, the FCA’s rules require insurers to handle claims fairly and promptly; provide reasonable guidance to help a policyholder make a claim, and appropriate information on its progress; not reject a claim unreasonably; and settle claims promptly once settlement terms are agreed. The FCA has robust powers to take action against firms that do not comply with its rules. |
| UIN 101885 | 02 Jan 2026 |
Impact of the March 2026 deadline |
Relying on the passage of time to naturally exhaust valid claimsQuestion: To ask the Chancellor of the Exchequer, what assessment her Department has made of the potential impact of the March 2026 limitation deadline on unresolved Covid-19 Business Interruption claims. Lucy Rigby, answered on 8 January 2026: The Financial Conduct Authority (FCA), as the independent regulator for financial services, sets the conduct standards required of insurance firms. This includes rules requiring insurers to handle claims fairly and promptly. With respect to business interruption claims linked to Covid-19, the Supreme Court published its final judgment in the FCA test case in January 2021. At the time of the judgment, the FCA set out its expectation that insurers should communicate to all impacted policyholders what the judgment meant for their claim and that insurers should move quickly to resolve claims as determined by the judgment, making interim payments wherever possible. It is important to note that the FCA court case did not cover all potential issues with business interruption policies but aimed to provide certainty to as many policyholders as possible. The FCA, as the independent regulator, has robust powers to take action where firms do not appear to be meeting their expectations and treating their customers fairly. |
| UIN 101887 | 02 Jan 2026 |
Litigation as a barrier |
Using superior legal resources to create barriers for smaller policyholdersQuestion: To ask the Chancellor of the Exchequer, what steps she is taking to ensure insurers do not use litigation to prevent small business policyholders from making claims. Lucy Rigby answered on 8 January 2026: The Financial Conduct Authority (FCA), as the independent regulator for financial services, sets the conduct standards required of insurance firms. This includes rules requiring insurers to handle claims fairly and promptly. With respect to business interruption claims linked to Covid-19, the Supreme Court published its final judgment in the FCA test case in January 2021. At the time of the judgment, the FCA set out its expectation that insurers should communicate to all impacted policyholders what the judgment meant for their claim and that insurers should move quickly to resolve claims as determined by the judgment, making interim payments wherever possible. It is important to note that the FCA court case did not cover all potential issues with business interruption policies but aimed to provide certainty to as many policyholders as possible. The FCA, as the independent regulator, has robust powers to take action where firms do not appear to be meeting their expectations and treating their customers fairly. |
| UIN 122583 | 20 March 2026 |
Sector Impact |
Quantifying the “Limitation Windfall” at the expense of the SME economyQuestion: To ask the Chancellor of the Exchequer, what assessment her Department has made of the potential impact of valid Covid-19 business interruption claims becoming time-barred in March 2026 on the insurance sector. Lucy Rigby answered on 30 March 2026: The Financial Conduct Authority (FCA), as the independent regulator for financial services, sets the conduct standards required of insurance firms. This includes rules requiring insurers to handle claims fairly and promptly.The Supreme Court published its final judgment in the FCA’s Business Interruption Insurance test case in 2021. At the time of the judgment, the FCA set out its expectation that insurers should communicate to all impacted policyholders what the judgment meant for their claim and should move quickly to resolve claims as determined by the judgment. The FCA court case did not cover all potential issues with business interruption policies. The FCA has been clear that, in the event of further court rulings, insurers will need to consider carefully how the rulings impact claims they have already decided. The FCA considered the issue of new ‘stop the clock’ guidance as part of its response to Stewarts LLP on 23 January. The FCA was clear that insurers must look at claims that have already been made in light of any new legal rulings to see if any action must be taken. Where no claim has been submitted, it is not clear why an insurer would not be able to rely on relevant time limits set out in the insurance policy, subject to the particular circumstances of each claim and compliance with the FCA’s broader rules. The FCA is continuing to supervise firms to ensure they are meeting their expectations and has robust powers to take action where necessary. The above answer was grouped with UIN 122587 and UIN 122586 (both below). |
| UIN 122584 | 20 March 2026 |
“Stop the Clock” |
Questioning the refusal to provide a regulatory rescue mechanismQuestion:To ask the Chancellor of the Exchequer, what discussions she has had with the FCA on stop the clock guidance and related litigation. A ministerial response was given on 30 March 2026, it was a grouped answer with UIN 122583, which is shown above. |
| UIN 122585 | 20 March 2026 |
FCA Consumer Duty |
Knowingly causing “foreseeable harm” through, for example by refusal to entertain standstill agreements or engaging in discriminationQuestion: To ask the Chancellor of the Exchequer, what steps she is taking to ensure adherence to the FCA’s Consumer Duty requirement for firms to avoid causing foreseeable harm. Lucy Rigby Answered 25 March 2026: The Financial Conduct Authority’s (FCA’s) Consumer Duty requires firms to act in good faith, prevent foreseeable harm, and act in the best interests of consumers. All FCA-authorised firms are required to comply with the Consumer Duty. The FCA has extensive powers to enforce regulations and to impose penalties for breaches of regulation. This includes powers to investigate potential breaches, issue fines and ultimately to withdraw authorisation in the case of serious breaches. The FCA is operationally independent and the Treasury has no role in ensuring firms meet their responsibilities under the Consumer Duty. The Treasury continues to work closely with the FCA to hold it to account for delivering against its statutory objectives, including its objective to secure an appropriate degree of consumer protection in relation to the activities it regulates. |
| UIN 122586 | 20 March 2026 |
Discrimination |
Potential systemic unfairness or breaches of the Equality Act 2010Question: To ask the Chancellor of the Exchequer, what steps she is taking to ensure that policyholders with protected characteristics are not discriminated against by insurance companies. Lucy Rigby Answered 30 March 2026: Insurers make commercial decisions about pricing and the terms of cover they offer based on their assessment of the relevant risks. However, the government is determined that insurers treat customers fairly and insurers must comply with relevant legislation, including the Equality Act 2010. The Act generally prohibits discrimination based on certain personal characteristics, though the law accepts that some exceptions apply for insurance. The Financial Conduct Authority’s (FCA) rules also require insurers to treat customers fairly. The FCA requires firms to ensure their products offer fair value (i.e. if the price a consumer pays for a product or service is reasonable compared to the overall benefits they can expect to receive). The FCA has robust powers to monitor firms and, where necessary, to take action against firms that do not comply with its rules. The Government also seeks to ensure that people are able to access the financial products they need. That is why I published a Financial Inclusion Strategy in November which includes interventions to increase household financial resilience through insurance and help people find the right insurance product for their needs. |
| UIN 122587 | 20 March 2026 |
Permanent Deprivation |
A strategic attempt to time out non-litigants before the Nov 2026 trialQuestion: To ask the Chancellor of the Exchequer, what steps her Department is taking to ensure that SMEs not party to (a) NFU Mutual and (b) Bath Racecourse litigation are not permanently deprived of the right to an indemnity due to the expiration of limitation periods. A ministerial response was given on 30 March 2026, it was a grouped answer with UIN 122583, which is shown above. |
The following questions have been part of the business of the House of Commons, tabled by Kevin Hollinrake MP.
Parliamentary Question |
Date Tabled |
Core Area of Scrutiny |
Implied Conduct Issue & Full Question Text |
| UIN 113696 | 20 Feb 2026 |
FCA/Stewarts Letter & Compliance |
Insurers are failing to “self-assess” and reopen claims despite being instructed to do so by the regulator following new legal precedents.Question: To ask the Chancellor of the Exchequer, with reference to the FCA’s letter to Stewarts LLPs, dated 23 January 2026, what assessment her Department has made of the level of compliance of insurers with the FCA’s expectations to review and revisit Covid Business Interruption claims following post-Test Case court rulings. Lucy Rigby, Answered on 2 March 2026: The Financial Conduct Authority (FCA), as the independent regulator for financial services, sets the conduct standards required of insurance firms. The FCA has made clear its expectation that insurers carefully consider how new legal rulings affect claims they have already decided. It is for the FCA to supervise firms and, if necessary, take action against those that do not comply with its rules. The FCA has robust powers to take action where it deems appropriate.The FCA’s 23 January letter (available online at: https://www.fca.org.uk/publication/correspondence/fca-response-insurance-open-letter.pdf) stated that the FCA stopped publishing business interruption claims data in March 2023. Questions about data held by the FCA can be addressed directly to the FCA. |
| UIN 111734 | 9 Feb 2026 |
Data Transparency & Accountability |
The FCA has stopped tracking claims data, creating a “dark market” where insurer misconduct cannot be quantified.Question: To ask the Chancellor of the Exchequer, what data the Financial Conduct Authority holds on the number of Covid Business Interruption claims that were reopened or reassessed by insurers following post-Test Case court judgments. Lucy Rigby, Answered on 2 March 2026: The Financial Conduct Authority (FCA), as the independent regulator for financial services, sets the conduct standards required of insurance firms. The FCA has made clear its expectation that insurers carefully consider how new legal rulings affect claims they have already decided. It is for the FCA to supervise firms and, if necessary, take action against those that do not comply with its rules. The FCA has robust powers to take action where it deems appropriate. The FCA’s 23 January letter (available online at: https://www.fca.org.uk/publication/correspondence/fca-response-insurance-open-letter.pdf(opens in a new tab)) stated that the FCA stopped publishing business interruption claims data in March 2023. Questions about data held by the FCA can be addressed directly to the FCA. |
| UIN 111734 | 17 Feb 2026 |
Stakeholder Engagement |
The regulator is ignoring warnings from major industry bodies regarding the scale of the unresolved claims crisisQuestion: To ask the Chancellor of the Exchequer, what recent discussions the Financial Conduct Authority has had with representative bodies, including UKHospitality, on unresolved Covid Business Interruption claims. Lucy Rigby, Answered on 17 February 2026: The Financial Conduct Authority (FCA), as the independent regulator for financial services, sets the conduct standards required of insurance firms. This includes rules requiring insurers to handle claims fairly and promptly. The FCA meets with a wide variety of organisations in the course of delivering its statutory objectives. Queries about such engagements can be addressed directly to the FCA. The Supreme Court published its final judgment in the FCA’s Business Interruption Insurance test case in 2021. At the time of the judgment, the FCA set out its expectation that insurers should communicate to all impacted policyholders what the judgment meant for their claim and should move quickly to resolve claims as determined by the judgment. The FCA court case did not cover all potential issues with business interruption policies. The FCA has been clear that, in the event of further court rulings, insurers will need to consider carefully how the rulings impact claims they have already decided. The FCA is continuing to supervise firms to ensure they are meeting their expectations and has robust powers to take action where necessary. |
| UIN 111733 | 09 Feb 2026 |
Economic Impact on SME Sector |
The Treasury is ignoring the systemic economic damage to the hospitality and retail sectors caused by these delays and enabling time-barred claimsQuestion: To ask the Chancellor of the Exchequer, what assessment he has made of the potential impact unresolved Covid Business Interruption claims expiring without payment on hospitality and leisure businesses. Lucy Rigby, Answered on 17 February 2026: The Financial Conduct Authority (FCA), as the independent regulator for financial services, sets the conduct standards required of insurance firms. This includes rules requiring insurers to handle claims fairly and promptly. The FCA meets with a wide variety of organisations in the course of delivering its statutory objectives. Queries about such engagements can be addressed directly to the FCA. The Supreme Court published its final judgment in the FCA’s Business Interruption Insurance test case in 2021. At the time of the judgment, the FCA set out its expectation that insurers should communicate to all impacted policyholders what the judgment meant for their claim and should move quickly to resolve claims as determined by the judgment. The FCA court case did not cover all potential issues with business interruption policies. The FCA has been clear that, in the event of further court rulings, insurers will need to consider carefully how the rulings impact claims they have already decided. The FCA is continuing to supervise firms to ensure they are meeting their expectations and has robust powers to take action where necessary. |
The Mechanics of the “Limitation Windfall”
While the term “windfall” is politically sensitive, the mechanics described in these questions point to the possibility of significant financial retention for insurers, which has not been fully quantified in published accounts oer the last half decade accounts in some cases.
By scheduling certain preliminary issue trials for November 2026, the resolution of key legal questions has effectively been pushed beyond the March 2026 limitation deadline for many policyholders.
This creates a scenario where a business’s legal right to an indemnity may expire before the court even decides if the policy was triggered.
Every claim that passes this deadline without a filed court action or a “standstill agreement” is a liability permanently removed from an insurer’s balance sheet.
Speaking generally, when a firm prioritizes the expiration of a calendar deadline over the underlying merits of a claim, it transitions from a standard legal defense into a significant failure of institutional character.
For an organization—particularly, on many views one with mutual status—the decision to rely on the passage of time to extinguish a liability is a move toward procedural opportunism.
It suggests that the objective is no longer to resolve a dispute based on the facts of the policy, but rather to wait for the financial and legal stamina of the policyholder to fail.
In this context, the use of a limitation period as a primary shield, if that happens, is not merely a technicality; it is a strategic choice to avoid a fair accounting, this is beacuse this approach sits in direct opposition to the duty of a mutual insurer to act in the best interests of its members, replacing a culture of protection with a culture of avoidance.
A Measured Assessment of Responsibility
The most recent inquiries shift the focus toward the FCA Consumer Duty, which requires firms to avoid causing “foreseeable harm.” Lawmakers are signaling that the conduct of insurers is being assessed for systemic unfairness. This suggests that the scrutiny is no longer restricted to contract wording; it is an investigation into whether the response of the insurance industry to the pandemic has caused lasting damage to the SME and rural economy.
The convergence of these parliamentary papers provides a sober, factual account of a period where procedural mechanics may turn out to have been used to mitigate a legal obligation. As the March 2026 deadline passes, this record remains as evidence of the moment when mutual trust was tested against a strategy of exhaustion.
The Parliamentary scrutiny of the March 2026 limitation deadline is underscored by data from the House of Lords Library briefing on the hospitality and retail sectors. Mapping these and other Parliamentary Questions against this ledger illustrates how a reliance on procedural expiration constitutes “foreseeable harm” to the SME infrastructure. Within this wider context, the strategic use of delays to prioritize a calendar deadline over the resolution of valid claims is a particularly poor reflection on the institutional character of the insurance firms involved.
This blog was be updated as Ministerial Replies are made on the Parliamentary Record. Last Updated 30 March 2026.
