Over the past weeks, several lawsuits have been filed in courts across the country, by both insurance carriers and insureds, relating to coverage disputes for lost business income resulting from government-enforced COVID-19 business closures. Business owners allege that they were forced to close or limit operations by government authorities as part of state and federal efforts to prevent the spread of COVID-19, resulting in significant lost business income. These insureds include businesses such as restaurants, bars, medical offices, movie theaters, production companies and others. Insurers generally respond by arguing that business interruption loss are only paid when there is “direct physical damage” that leads to lost business income, and/or that the insurance policies include exclusions related to virus, bacteria or communicable diseases. One insurance carrier, Travelers Insurance, has even filed suit against a Los Angeles law firm who sued the insurer earlier this month. There, the carrier argued that virus-related losses are specifically excluded from business interruption policies issued to the firm; and, even without the exclusion, coverage would still be denied because the virus did not cause physical damage.
As a business owner, what do you need to know? First, you’ll need to know and understand the key terms and concepts related to your insurance policy. Then, you’ll need to know and understand how those key terms and concepts frame the issues of an insurance coverage dispute. Then, you’ll need to know how courts generally resolve insurance coverage disputes. Finally, if you want to file a claim for business interruption or want to revisit a claim that your insurance carrier previously denied, you’ll want to speak to an attorney.
We have done the research. We know the key issues. We know what to look for in your insurance policy. If you are a business owner that has lost business as a result of COVID-19 government shutdowns, contact us today. We will review your insurance policy at no charge to look for the relevant coverages and exclusions. We will be able to advise if there is a case to be made for insurance coverage for your lost business income. Don’t wait. The fight between insurance carriers and businesses is on. Don’t miss out.