Background
CP Holdings Limited and its subsidiaries sought to claim €10 million in business interruption (BI) losses arising from COVID-19 closures under a 2018 Global Master Policy issued by Assicurazioni Generali. The claimants’ underlying rectification claim—seeking to reform the 2019 renewal to include 2018 policy terms—had failed in the main judgment handed down on 29 June 2026. However, Mr Justice Andrew Baker reserved jurisdiction to answer preliminary issues concerning the true construction of the 2018 Global Policy’s limits and coverage provisions.
The central dispute concerned whether policy limits, particularly the €10 million “Disease Clause” sub-limit for business interruption losses, were “per loss” limits (with each declared business suffering a separate loss) or “annual aggregate” limits applying across all claimants. The defendants contended that General Clause 5 (addressing the composite nature of multiple insureds) worked together with the sub-limit to cap aggregate liability at €10 million. The claimants argued that limits operated separately for each business as declared in the annual spreadsheet supporting the insurance placement.
The policy covered CP Holdings’ operations across multiple countries (Czech Republic, Slovakia, Romania, Hungary, and the United Kingdom) with a primary €150 million “Policy Loss Limit” and a €10 million sub-limit for disease-related BI claims, including COVID-19 losses under the Disease Clause.
The Court’s Holding
Justice Baker held that the €150 million Policy Loss Limit and the €10 million Disease Clause sub-limit both operated as “per loss” limits, not annual aggregate limits. The court rejected the defendants’ argument that General Clause 5 converted these into aggregate caps applying across all claimants. The mere existence of multiple insureds did not trigger an annual aggregate limit; such a limit had to be explicitly stated in the Schedule.
For COVID-19 business interruption losses under the Disease Clause (a “pure” BI peril not requiring underlying property damage), the court held that each business as declared in the annual spreadsheet constituted a separate insured loss for limit purposes. Critically, the definitions of “Indemnity Period” and “Maximum Indemnity Period” had to be read as commencing from the business interruption itself—not from property damage, which the basic BI cover required—to give meaningful effect to the Disease Clause extension. The indemnity period thus ran for up to 36 months from the commencement of interruption.
The court rejected appeals to the presumption against surplusage in construing General Clause 5, emphasizing that such general language appearing in page 57 of an 85-page policy could not override the plain meaning of the Schedule’s per-loss limits stated 50 pages earlier. The role of the annual spreadsheet declaring specific businesses and locations was paramount in determining whether multiple entities’ operations constituted a single declared business (subject to General Clause 5) or separate losses.
Key Takeaways
- Policy limits stated as “Each and Every Loss” in an insurance schedule are per-loss limits, not annual aggregate limits, absent explicit language to the contrary.
- For business interruption cover, each business as declared in an insurer’s supporting schedule or spreadsheet constitutes a separate loss for limit purposes, even if the underlying trigger (e.g., COVID-19) is the same.
- The €10 million Disease Clause sub-limit applied per insured BI loss, not in the annual aggregate; a single business could suffer multiple separate €10 million limit losses in different periods or from different qualifying perils within a single policy year.
- General Clause 5’s “no increase in limits” language protects insurers only against multiplication of per-loss limits when multiple corporate entities operate a single declared business; it does not create or imply annual aggregate limits.
- For “pure” BI losses under extended clauses (not requiring property damage), policy definitions must be read as referring to the business interruption commencement, not property damage, to have meaningful effect.
- The physical or contractual declaration of businesses in schedules, spreadsheets, and similar documents is a critical evidentiary guide to determining how many separate insured losses have occurred.
Why It Matters
This judgment provides crucial clarity on how business interruption insurance operates when limits are stated on a “per loss” basis—a common structure in commercial policies. It establishes that absent explicit annual aggregate language, each declared business or location can exhaust the full policy sub-limit independently. This significantly impacts the scope of coverage available to large multinational enterprises and groups of companies operating multiple premises or business units under umbrella or master policies. Insurers seeking to impose annual aggregates across multiple insureds or locations must do so expressly in the schedule, not by implication or reliance on general composite-policy clauses.
The decision is particularly significant for pandemic-related and other “pure” BI claims triggered by non-damage perils (government orders, disease outbreaks, supply chain disruption). By holding that policy definitions must be read to accommodate such peril-triggered losses—even when the policy’s standard definitions presume property damage—the court rejected a narrow reading that would have rendered extended BI clauses meaningless. This principle may reshape how courts interpret other extended coverage clauses and how insurers draft disease, utilities, and denial-of-access extensions to ensure their intended limits are clearly expressed.