Federal Court Dismisses Class Actions for COVID Business Interruption Claims
Federal Court Dismisses Class Actions for COVID Business Interruption Claims
2
The information on this website is general in nature and does not take into account your objectives, financial situation, or needs. Consider seeking personal advice from a licensed adviser before acting on any information.
The Federal Court has determined that business interruption claims related to COVID-19, involving four insurers, should not proceed as class actions.
This ruling obliges individual policyholders to pursue their cases separately if they wish to proceed.
Justice Michael Lee announced on Friday that proceedings are adjourned pending the issuance of "declassing orders," following arguments from insurers against group actions. Policyholders who had hoped to be part of the class actions will receive notices explaining their rights and options for individual claims.
The legal firms involved, including Gordon Legal and Slater & Gordon, had initiated cases against multiple insurers. Specifically, Gordon Legal filed on behalf of Cody Gemtec Retail t/as the National Opal Collection against Syndicate 2003 at Lloyd’s, and Strand Fitness and others against QBE. Slater & Gordon filed cases for CMC Hospitality against Insurance Australia, and Vicki Field Swim School against Hollard.
An IAG spokesperson welcomed the decision, urging customers with potential COVID-19-related business interruption claims to file those claims individually to facilitate efficient assessment through their standard process. The company also highlighted that a further case management hearing is anticipated and the appeal period remains active, promising updates "at the appropriate time."
James Naughton, a partner at Gordon Legal, told insuranceNEWS.com.au that individuals are encouraged to contact the firm to discuss their options for submitting individual claims against their insurers.
The court had previously ordered that policyholders be notified to register their interest in the proposed class actions, which garnered thousands of responses by a set deadline earlier this year.
Cody Gemtec Retail t/as the National Opal Collection vs. Syndicate 2003 at Lloyd's
Strand Fitness vs. QBE
CMC Hospitality vs. Insurance Australia
Vicki Field Swim School vs. Hollard
John Berrill, the principal of Berrill and Watson Lawyers, clarified that Friday's ruling addresses only the procedural aspect of how claims should be resolved-individual vs. class actions-without commenting on the validity of the claims. He emphasized the importance of policyholders understanding their rights and considering their options promptly since claims linked to the 2020 pandemic lockdowns are approaching the six-year statute of limitations for legal action.
In February 2025, an independent review conducted by McGrathNicol uncovered significant issues within Netstrata, a prominent strata management company. The investigation revealed that Netstrata failed to disclose commissions and did not obtain multiple quotes for services, potentially breaching legal obligations. Additionally, the review identified undisclosed personal relationships between Netstrata employees and suppliers, raising serious concerns about conflicts of interest. - read more
In May 2025, NSW Fair Trading took decisive action against Result Strata Management Pty Ltd and its General Manager, Michael Lee, by permanently revoking their licences to operate in the state's strata management sector. This move followed an investigation that uncovered multiple breaches of the Property and Stock Agents Act 2002, highlighting significant misconduct within the company. - read more
In November 2025, CHU, Australia's largest strata insurance underwriting agency, released its 2025 State of the Strata Market report, providing a comprehensive analysis of the current trends and challenges within the strata industry. The report offers valuable insights into premium trends, climate-related risks, regulatory developments, and emerging sector challenges. - read more
Australian homeowners are experiencing significant increases in home insurance premiums, largely due to the escalating risks associated with climate change. Recent analyses reveal a national average premium hike of 14%, translating to an additional $343 annually for policyholders. This trend underscores the growing financial burden on homeowners as extreme weather events become more frequent and severe. - read more
The Australian construction insurance market has entered a notably softer phase in 2025, characterized by a significant reduction in premiums across various lines. This shift is primarily attributed to increased competition among insurers, offering clients more options and driving down costs. - read more
In today's digital landscape, Australian small businesses face a myriad of cyber risks that can threaten their operations and financial stability. From sophisticated phishing scams to debilitating hacking attacks, the need to safeguard against such digital threats has never been more pressing. This introductory guide serves to illuminate the complexities of the cyber risk environment within Australia, focusing on the small business sector's unique vulnerabilities. - read more
In an age where digital presence intertwines with daily operations, the threat landscape in Australia has magnified, exposing businesses to an evolving array of cyber threats. From sophisticated phishing attempts to ransomware attacks, the risk of digital insecurity looms large. Australia, with its growing technological adoption, finds itself facing an upsurge in cyber threat incidents year over year. - read more
In this digital age, online liabilities have become a crucial concern for individuals and businesses alike. At its core, an online liability refers to the potential risks and responsibilities associated with using the internet. These risks can range from data breaches to financial theft, and they have significant implications in our increasingly connected world. - read more
Cyber risk management involves identifying, assessing, and mitigating risks related to digital and online threats. These threats can include unauthorized access to sensitive information, data breaches, and other malicious activities targeting an organization’s digital infrastructure. - read more
Cyber insurance is a type of insurance designed to protect businesses from internet-based risks and, more generally, from risks relating to information technology infrastructure and activities. It covers losses related to data breaches, cyber extortion, and other kinds of cyber attacks. - read more
Knowledgebase
Moral Hazard: The concept that individuals may take on more risk when they do not bear the full consequences of that risk, often relevant in insurance scenarios.