By Favour Nnabugwu
Axa has offered settlements totalling €300million before reinsurance to 15,000 French restaurants for business interruption (BI) losses, after they closed to minimise the spread of Covid-19.
The move followed disputes between AXA and French restaurants since the outbreak of the pandemic, with some high-profile court settlements falling in favour of policyholders.
Axa France said the “fixed and definitive lump-sum payment” will be made to policyholders of its standard policy with extended cover for BI losses for “administrative closure”.
Axa said it “regrets the misunderstandings with some of our restaurant clients” over policy wordings, but added that it stands by its argument that the policies do not cover “collective administrative closures”.
Axa said the cost of the settlement after tax and reinsurance is expected to be offset by “favourable developments in 2021 related to Covid-19, in France and Europe”.
The sum on offer is equivalent to 15% of catering turnover, Axa said, and covers closures announced by the government on 14 March 2020 and 29 October 2020. The settlement offer is expected to be open to policyholders until the end of September 2021.
“As restaurants are finally allowed to welcome their customers again, we are taking this initiative so that everyone can look to the future and focus on the restart of economic activity. Such a large initiative is unprecedented for Axa France,” said Patrick Cohen, CEO of Axa France.