Australia’s biggest insurers won’t be required to pay out compensation to clients who suffered COVID-19-related losses following a court decision.

A number of companies, including IAG, Allianz, and Chubb, fought against each other in court over how many claims they should handle following the pandemic.

According to insurance companies, businesses that were affected by the COVID-19 virus did not qualify for compensation.

In a landmark ruling, a judge ruled that insurance firms were not liable for the damages caused by COVID-19 disruption.

She noted that policies that deal with the prevention of access to certain facilities or areas, or the containment of certain infectious diseases, were narrow enough to exclude certain scenarios.

She said since businesses were not allowed to operate on their premises during an outbreak, their losses were not covered by insurance policies.

Not all businesses were ordered to close during the lockdown, according to the insurance industry.

Only nine firms claimed compensation for an infectious diseases outbreak within a certain radius of their business.

She noted that there were substantial issues with Meridian Travel’s claim, particularly as it appeared that its losses were caused by the government’s decision to bar international travel and cruise ships from the market.

Justice Jagot has also granted leave to appeal the decision.

The delay in implementing the insurance reforms needed to address the pandemic could cause businesses to wait for payouts for years.

Jagot said that if the decision is overturned on appeal, then the claims should be reduced and the government should provide support to minimize the losses.

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