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French restaurant settles with Axa in tussle over lockdown losses

Published 23/06/2020, 16:31
© Reuters. FILE PHOTO: The coronavirus disease (COVID-19) outbreak, in Paris
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PARIS (Reuters) - A French restaurant owner who won a court battle with Axa over lockdown-linked losses said on Tuesday he had reached a further settlement with the insurer, potentially setting the tone for payouts to other businesses facing similar insurance problems.

Stephane Manigold, who owns four restaurants in Paris, including one with two Michelin (PA:MICP) stars, took Axa to court for not paying out on a business-interruption policy, after France imposed a two-month lockdown to fight the COVID-19 pandemic.

A Paris court in May ordered the insurer to cough up two-months worth of revenue losses - or 45,000 euros (£40,751) for one of Manigold's restaurants, Le Flaubert.

The businessman said he had now reached a broader compensation agreement that covered all his restaurants.

Axa confirmed a settlement had been reached, but did not disclose the terms of the deal.

It is not the only insurer facing such issues.

French financial watchdog ACPR said in a report on Tuesday that, based on a survey of insurers, just under 3% of their policies would trigger clear-cut business-interruption payouts linked to the pandemic. Another 4% were ambiguous, it said.

Manigold's case gave impetus to similar claims from restaurant managers and businesses hurt by the shutdowns in France and elsewhere, including nightclubs, which have yet to re-open in many European countries.

Axa has since said there were about 1,700 restaurant contracts in France with ambiguous clauses which it was now looking into, although that is only a fraction of its 20,000 insurance policies in the sector, most of which do not carry explicit business-interruption conditions.

The insurer is in talks with some 600 other restaurants over compensation, a spokeswoman said.

© Reuters. FILE PHOTO: The coronavirus disease (COVID-19) outbreak, in Paris

"What was missing at first was any form of dialogue with Axa," Manigold told Reuters, adding he was pleased others might now benefit from similar payouts.

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