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Covid-19: a letter stirs up tensions between insurers and restaurateurs

2020-11-25T05:28:49.695Z


Many restaurateurs have received an amendment to their contract excluding any guarantee of operating losses in the event of a pandemic. Those who r


New tensions between restaurateurs and insurers.

In the midst of the second wave of confinement, a registered letter sent by all insurance companies to their insured restaurateurs ignites the powder and could well revive the controversy over compensation for operating losses due to the pandemic.

This letter is an amendment to their contract which explicitly excludes any cover for this risk from January 1, 2021.

Since mid-March, the date of the start of the first confinement and the administrative closure of restaurants and shops, insurers have repeated that they cannot cover the risk of a pandemic such as that of Covid-19.

Being systemic, they believe that it cannot be the subject of risk pooling, the founding principle of insurance.

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"The vast majority of business interruption insurance contracts clearly exclude the pandemic," explains the French Insurance Federation (FFA).

And for the minority of them, barely 4%, who have ambiguous clauses, but which were not drafted to cover such a risk, it is in everyone's interest to clarify them.

"

It is up to restaurateurs to choose between accepting this rider by December 31 if they want to keep their professional multi-risk contract for the year 2021. Or to refuse it, at the risk of no longer being insured from January 1.

A non-choice for many small and large restaurateurs concerned, or nearly a third of the profession.

"It's blackmail"

For Jean-François Trap, "it's even blackmail".

The famous Parisian chef at the head of six restaurants including the two-star Grand Restaurant (Paris, 8th arrondissement) is very upset against Axa, his insurer, who has just sent him a letter of recovery.

"The world collapsed when I opened it," he protests.

We try to survive, we move to save our jobs with the take-out sale… How dare to say that we have a choice one month before the end of the year?

"

This is how @ AXAFrance's solidarity is expressed in parallel with the institutional communication: after refusing to compensate us, Axa wanted us to sign an amendment which reduced our guarantees.

We refused.

I received this termination letter yesterday signed @guiborie pic.twitter.com/dXKT4riDpk

- Jean François Trap (@JF_Piege) November 11, 2020

The chief published the letter sent by Axa on social networks and had his lawyers study the legality of the amendment.

Already in litigation with his insurer to obtain compensation for his operating loss during the first confinement, Jean-François Piège sees in addition the implicit recognition that his guarantee is indeed valid.

"This endorsement comforts me in the idea that I am currently well insured for my operating losses and that Axa must keep the commitment made in the insurance policy that I took out five years ago", insists he.

Discussions at Bercy for a future specific compensation scheme

For Axa, it is quite different.

“This amendment responds to a recommendation from the Prudential Control and Resolution Authority (ACPR) to change this type of contract after the confusion that has reigned since the start of the Covid-19 crisis,” explains the insurer.

"Our priority is the clear understanding by each client of what is covered and what is not ... We have therefore, like all insurers, reviewed our contracts for clients who had a loss of business without damage guarantee and 80% have already signed it, assures its spokesperson.

The global insurance giant is far from being the only one concerned.

Generali France, which has "about a thousand contracts whose wording may seem ambiguous", also makes "adjustments" to its contracts ranging from "the removal or overhaul of guarantees".

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"These revisions are all the more necessary as the reinsurers

(Editor's note: with which the insurance companies are themselves insured for major risks)

have decided to explicitly exclude the pandemic from all their contracts and throughout the world" from 2021, adds Generali.

A future private-public compensation scheme for operating losses linked to natural disasters (known as “Catex”) is under discussion with the Minister of the Economy and Finance, Bruno Le Maire, whose arbitration should take place soon. .

Source: leparis

All business articles on 2020-11-25

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