COVID-19 and the impact on UK corporate insolvencies

Co-authored by RPC and Berkshire Hathaway Specialty Insurance 

It has been just over two years since the World Health Organisation first declared Covid-19 a pandemic, and as the UK prepares to transition away from an era of pandemic restrictions and unprecedented government intervention, to a more ‘business-as-usual’ open economy, it seems timely to consider the possible legacies of this crisis on UK businesses.

In doing so, we look to consider:

1. How the impacts of Covid-19 may differ from prior recessionary periods;
2. Whether the downturn will result in a period of heightened corporate insolvencies, and;
3. Whether the government measures discussed in this article, and the scale of the economic shock experienced by the UK economy (and many others), will lead to emerging risks and liability exposures to which company directors (and the providers of directors and officers insurance) should take heed.

To begin to address these questions, we should first remind ourselves of the scale of the COVID-19 impact over the last two years.