Originally written by Timothy Adler on Small Business
NFU Mutual, the insurance company, is using small business Covid grants already received by business owners as a pretext to cutting coronavirus payouts.
The insurer is paying less to struggling small businesses in the hospitality sector because it says they have received small business Covid grants.
The Government has paid more than £10bn to almost 900,000 small businesses in need in the form of one-off grants of up to £10,000, paid out by local authorities.
NFU Mutual said deductions made to reflect state aid are only applied to loss-of-profit claims, not to those made for loss of income. Determining a loss-of-profit claim settlement, it said, includes the need to consider “all taxable income”, including Government grants, as well as any other forms of compensation.
However, the Professional Association of Self Caterers UK (PASC) has branded the practice “highly immoral” and suggests NFU Mutual is using it to boost its own profits.
PASC UK executive chairman Alistair Handyside told insurance trade magazine NS Insurance that insurers should honour their contracts and not behave “so poorly”.
Handyside said: “Overwhelmingly our members are small, family-run, rural and coastal businesses for whom the Small Business Grant Fund is a critical lifeline intended to