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‘We need to fight this’ - Business owners denied insurance payouts call upon ministers to take action

PUBLISHED: 14:35 16 April 2020 | UPDATED: 16:18 16 April 2020

Simon Wainwright, owner and chef at SW1 Restaurant in Gorleston. Photo: Simon Wainwright

Simon Wainwright, owner and chef at SW1 Restaurant in Gorleston. Photo: Simon Wainwright

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Business owners in Great Yarmouth are “appalled” at the rejection of their insurance claims over coronavirus - despite some paying thousands a year for added coverage.

Mark Dixon from the Kings Arms, Fleggburgh. Pcture: Nick ButcherMark Dixon from the Kings Arms, Fleggburgh. Pcture: Nick Butcher

Local enterprises such as the King’s Arms in Fleggburgh, as well as SW1 Restaurant, Hair Fusion and Ocean Room in Gorleston, claim they paid extra for insurance policies which covered them against “business interruption”.

But owners have been met with what one of them described as “101 different excuses” for insurers to avoid paying out.

Simon Wainwright, owner of SW1 restaurant, said his insurer rejected his entitlement to three months coverage for business interruption by “focusing on a technicality”.

Mr Wainwright’s insurance policy clearly states that he is covered by disruption resulting from “notifiable diseases” - which includes “an outbreak of any infectious or contagious disease, excluding AIDS”.

Kevin Huggins from Fusion Hair Consultants, Gorleston. Photo: Nick ButcherKevin Huggins from Fusion Hair Consultants, Gorleston. Photo: Nick Butcher

“We even got a wording expert to check if we were 100pc entitled, and we are,” he said.

But his insurer argued that pandemics were not the same as “notifiable diseases” and that he would not be receiving any money.

And while the restaurant owner said that his £10,000 government grant was “life saving”, it wasn’t going to cover the bills.

He said: “I was relying on compensation which would have given me £8-10k per month for three months. That way we wouldn’t have had to go into debt.

Kelly Evans, Managing Director of Ocean Room at Gorleston. Photo: Kelly EvansKelly Evans, Managing Director of Ocean Room at Gorleston. Photo: Kelly Evans

“The Government needs to intervene here or small businesses will seriously struggle.”

The same issue was true for Mark Dixon, owner of the King’s Arms in Fleggburgh.

He said: “We got a £25,000 grant from Great Yarmouth Council, which is extremely helpful and they were very quick about, but if insurers refuse to pay out the restaurant industry will be left in a catastrophic state.”

For Kevin Huggins, owner of Hair Fusion, his insurance policy went futher and named 37 specific diseases he is covered against - ranging from diseases such as leprosy and “plague” to Ebola and Yellow Fever.

EDP Norfolk Magazine. July. Food review at The King's Arms, Fleggburgh.EDP Norfolk Magazine. July. Food review at The King's Arms, Fleggburgh.

He said: “My insurers claimed that Covid-19 is not on the list. But I signed up for year-long insurance in October 2019 - and Covid-19 wasn’t even a thing then.

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“You’d expect insurance companies to be flexible.

“I got a £25,000 grant off the government but my wage bill last month was £30,000 alone.

SW1 Restaurant in Gorleston has only been up and running for three years. The owner, Simon Wainwright, says he only just began turning around a profit, and over March and April, lost around £35,000 in business turnover. Photo: Simon WainwrightSW1 Restaurant in Gorleston has only been up and running for three years. The owner, Simon Wainwright, says he only just began turning around a profit, and over March and April, lost around £35,000 in business turnover. Photo: Simon Wainwright

“I pay over £2,000 yearly for insurance and I don’t want these companies to be getting away with this when they’ve got our money in their pockets.

“I’ve emailed my MP, Brandon Lewis, but all he said was that the Government is ‘looking into it.’”

Kelly Evans of Ocean Room nightclub in Gorleston has run up against similar obstacles.

“I’m literally tearing my hair out right now,” she said.

Gorleston's Ocean Room has been leased out from the council for 40 years and owner Kelly Evans Gorleston's Ocean Room has been leased out from the council for 40 years and owner Kelly Evans "can't imagine that having to come to an end". Photo: Kelly Evans

“Not only can I not get a council or government grant because my business rates are too high, but insurers are refusing to give me what I’m entitled to.”

In her situation, the insurance company is suggesting that her “Prevention of Access” coverage only applies to physical damage, and not a government-imposed lockdown.

In an email seen by this newspaper, her insurance broker said: “The outbreak is not causing damage to your property or that of property in the surrounding area, so regrettably, your policy would not respond to any alleged shortfall in gross profit as a result of the virus.”

When she asked the broker to speak to the insurance company directly, they told her no.

She said: “What they’re trying to do is put you off fighting this by blocking contact, but that’s not fair.”

“We’ve leased this building out from the council for 40 years and I can’t bear the thought of that having to come to an end.

Only yesterday, the Financial Conduct Authority told insurers to pay out to firms as soon as possible, or else explain themselves to the watchdog.

Mr Wainwright said: “I have filed a complaint with the FCA and the ombudsman but it’ll only be effective if lots of firms do the same thing.

“What businesses in the area need to do now is club together and fight this.”

Mr Huggins has already started a petition to try and force the Government to intervene.


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