Coronavirus: Under-fire insurers hold secret talks over £100m fund for stricken charities

May 03, 2020

Some of Britain's biggest insurers are holding secret talks about creating a new fund to help charities which have been left unable to conduct fundraising activities during the coronavirus pandemic.

Sky News has learnt that the chairs of major insurance companies including Aviva, Hiscox and RSA have floated the idea during discussions in recent weeks.

The Association of British Insurers, the industry body, is also involved in the talks.

If it goes ahead, the objective of the new fund would be to donate sums to smaller charities which have been brought to the brink of collapse by the COVID-19 crisis, according to a person close to the situation.

The Treasury has separately pledged £750m for frontline charities affected by the pandemic, but officials in the sector have warned that this will not be nearly sufficient to prevent many from going to the wall.

Sources cautioned on Sunday evening that the talks about a new insurance industry-backed charitable fund were still at a tentative stage and may not go ahead.

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One said the £100m figure had been mooted during the talks but that it could yet differ materially from that amount.

The fact that such a vehicle is being considered, however, reflects the pressure that top insurance executives believe the industry is under amid suggestions it is failing to honour valid claims for business interruption cover.

On Friday, the City watchdog said it was planning to take the industry to court to determine the legitimacy of some claims from small businesses.

Action groups from disgruntled business owners have been formed against insurers including Hiscox and RSA.

"The insurance industry is giving extra help and support to customers and the wider society during this worrying time. Individually and collectively the industry continues to look at how it can play its part in supporting society in this unprecedented situation," an ABI spokesman said.

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