British Steel awaiting insurance dispute settlement that could save company
A disputed insurance claim dating back to June 2017 could
end up saving beleaguered British Steel, as the company seeks to turn around an
order of compulsory liquidation from the high court.
The claim dates back two years to an incident which
caused damage to one of its Scunthorpe blast furnaces, which required the site
to be shut down for several weeks due to safety reasons. An investigation into
the event lasted nine months ending up in British Steel’s claim being rejected
by insurers in May of last year.
The company has hired Mactavish to represent them in
their dispute with Zurich on the claim worth £30m, which would save British
Steel from liquidation. The insurance governance company’s investigation into
the rejection found multiple and important deficiencies in Zurich’s workings
and is of the belief that the claim should be settled in its entirety. For
their part, the insurer has yet to respond.
“From our review, we feel that Zurich and Liberty’s
investigation was incomplete and wrong,” commented Mactavish’s CEP Bruce
Hepburn. “It did not interview many of the relevant staff or even identify the
blast furnace blowout as the key cause of the claim, which we believe
categorically establishes cover under the terms and conditions of the policy.”
“Given British Steel’s current situation, settlement of this claim would have made a major contribution to securing the survival of this British institution that had finally been returned to profitability as a viable producer of high-end steel products.”
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