The COVID Review

A Collection of Legal Analyses on the Potential for Business Interruption Insurance Coverage

January 20, 2021

The coronavirus pandemic is an unprecedented event in the life of every person worldwide. Much as everyone remembers where they were when they learned of John F. Kennedy’s assassination, witnessed the attacks of 9/11, watched O.J. Simpson in the White Bronco, or viewed the Challenger explosion, COVID-19 will be a lasting, life-altering memory in the minds of everyone who has lived through it. Long after we’ve received a vaccine, the stunning impact that COVID-19 has had on the world will remain.

The pandemic has affected Americans in ways far beyond the illness itself. State and local governments have issued countless emergency orders shuttering businesses, restricting gatherings, and pleading with their citizens to stay at home when possible. A staggering number of Americans have found themselves unemployed or underemployed. Those fortunate enough to work remotely have suddenly needed to navigate a world of Zoom calls and makeshift home offices. And businesses nationwide have been forced to alter operations, and in many cases, temporarily or permanently close their doors.

These businesses have often turned to their insurers, seeking “business interruption” coverage to help offset their losses. As its name suggests, this coverage typically reimburses the policyholder for costs incurred when the business is unable to operate fully. These businesses contend that the forced closures and restrictions are precisely the type of harm covered by a policy that provides business interruption coverage and is within the policyholder’s reasonable expectation of coverage.

Insurance companies, predictably, have largely refused to cover these claims. Where they can, insurers have relied on virus exclusions in policies to deny coverage. They have also argued that their policies require “physical loss or damage,” and that the harm caused by COVID-19 does not meet this standard. Courts across the country have divided on the issue, with some finding that the coronavirus has caused physical loss to policyholders’ properties and others concluding that this is not the sort of harm that the policies are intended to cover.

We are now more than eight months into the pandemic, and only one clear takeaway has emerged: individual or consolidated coverage cases will turn on their specific circumstances. As the articles in this booklet discuss, whether a policyholder can obtain coverage for its COVID-19-related losses depends on the specific policy language, the facts of that policyholder’s case, and the legal precedent in the relevant jurisdiction. Gilbert attorneys look forward to helping clients navigate through these issues and present their best arguments for coverage.

As the COVID-19 pandemic continues to threaten the world, Gilbert attorneys are assisting clients with their COVID-19 insurance issues, and providing real-time legal counsel to businesses and governments throughout the United States.

The commercial insurance implications of the pandemic are growing, and changing daily. Gilbert attorneys are analyzing developments at courthouses, in governments, and in the insurance industry to offer clients and the business community needed resources to inform their legal options in this frightening time. As the COVID-19 pandemic continues to threaten the world, Gilbert attorneys are assisting clients with their COVID-19 insurance issues, and providing real-time legal counsel to businesses and governments throughout the United States.

The commercial insurance implications of the pandemic are growing, and changing daily. Gilbert attorneys are analyzing developments at courthouses, in governments, and in the insurance industry to offer clients and the business community needed resources to inform their legal options in this frightening time.

Click here for The COVID Review.

Gilbert LLP is a Washington-based law firm specializing in litigation and strategic risk management, insurance recovery and complex dispute resolution.