LONDON, June 26 (Reuters) - Groups of Aviva AV.L , Hiscox HSX.L...

LONDON, June 26 (Reuters) - Groups of Aviva AV.L , Hiscox HSX.L and QBE (QBE) policyholders can join Britain's markets watchdog in a High Court case to decide which insurers should pay out to businesses shut by the coronavirus pandemic, a judge said on Friday.

The policyholder groups would be able to present their views directly alongside the Financial Conduct Authority, which is consolidating the case for policyholders, High Court Judge Christopher Butcher told a hearing.

"It is necessary...that the argument is fully and properly put," he said at the hearing to discuss the procedural issues of the case.

The Financial Conduct Authority (FCA) turned to the courts after small businesses, from restaurants to leisure groups, said they faced ruin after attempts to claim millions of pounds collectively in compensation for lost business were rejected by insurers.

The case against eight insurers, including Aviva, Hiscox and QBE, is designed to clarify whether the pandemic and a government lockdown should trigger business interruption policies that provide cover when insured premises cannot be used because of restrictions imposed by a public authority and in the event of a notifiable disease or infection.

The test case is expected to provide clarity for tens of thousands of policyholders, including those who have policies with similar wordings sold by other insurers.

The FCA had agreed the policyholders could join and insurers did not oppose, the hearing heard.

However, the judge declined to allow a policyholder with a pubs policy with RSA, another of the insurers in the case, to join. The pubs policy focused on physical damage to property which was not within the scope of the case, he said.

Hiscox declined to comment while Aviva, RSA and QBE did not immediately respond to requests for comment.

The Hiscox Action Group, which represents almost 400 Hiscox policyholders, and an action group representing Aviva and QBE policyholders, also did not respond to requests for comment.

The case is due to come to trial in late July.

($1 = 0.8050 pounds)