HUNDREDS of businesses across the UK are joining forces in pursuing legal action against York insurer Hiscox over coronavirus payouts.

They say the firm, which has a huge office complex in Peasholme Green, sold them business interruption insurance policies before the pandemic which covered them being forced to close owing to a notifiable disease.

They claim it is now failing to honour their claims, but Hiscox says it is paying claims covered by its policies fairly and quickly.

The Night Time Industries Association (NTIA), which includes bar, club and restaurants shut by the lockdown, has formed an alliance with the Hiscox Action Group. They said that together they represented over 500 Hiscox policy holders with total insurance cover of over £50 million, adding that for many policy holders, access to the insurance funds was the difference between surviving and going under.

Michael Kill, of the NTIA, said the alliance would "ratchet up the pressure" on Hiscox, which should pay out quickly and in full. Mark Killick, of the action group, hoped it would "do the right thing" before too late.

Legal counsel Mishcon de Raya said Hiscox had said it didn’t intend to cover what had happened but this was irrelevant and it was looking at what was in the contract.

One claimant said his policy covered scenarios including an "inability to use the insured premises due to restrictions imposed by a public authority following various incidents occurrence of any human infectious or human contagious disease, an outbreak of which must be notified to the local authority." He claimed: “Under the current restrictions, it is clear that we are not allowed to use our premise insured, on order of the Government.”

Hiscox said: “We understand these are incredibly difficult times for businesses and we are paying claims that are covered by the policies we issue fairly and quickly.

“We review every case individually, and if any customer has concerns about the application of their policy, we encourage them to get in touch with us directly.”