Insurance Coverage for COVID-19 Claims

INSURANCE COVERAGE FOR COVID-19 CLAIMS
Jeffrey R. Schmieler, Esquire

            COVID-19 and the Coronavirus Pandemic is inflicting serious economic damages to individuals and businesses in enormous dimensions. These enormous losses, in turn, are resulting in COVID-19 insurance claims and litigation which involve the resolution of the complex insurance coverage issues raised by the Coronavirus losses.
            The impact of COVID-19 has adversely impacted virtually every individual and business in the United States.
            Although the insurance industry has initiated a nationwide coordinated effort to suppress corona-virus related claims, there are many Coronavirus claims which are valid claims for insurance coverage under the Property Damage Insurance Policies issued by the Insurance Industry, inclusive of the following:

• Many insurance policies do not contain virus exclusions in the policy
• Virus exclusions which may be contained in the property damage insurance policy may not apply to effectively deny coverage because exclusions in insurance policies are strictly construed by the Courts when interpreting the language of the policy.
• Legislation activity by both Federal and State Governments may alter the existing coverages afforded under the insurance policies.
• “Stay At HOME” orders have a direct bearing on insurance coverage afforded under the Property Damage insurance policies.
• As a direct result of the pandemic and concomitant infection and danger of serious illness and death, insured property cannot be used for its intended purpose and has been damaged resulting in property damage losses covered under the insurance policy.
• Insurance coverage can be sought for the existential threat caused by Government mandated closure orders.
• Developing research and CDC reports indicate COVID-19 physically infects and can stay viable for long periods and can remain alive and potentially deadly for days rendering exposed property to contagion and potentially unsafe and dangerous constituting property losses and damages.
• The Coronavirus is physically causing property losses and damages.
• Business Interruption losses are or may be covered under the property damage coverage including loss of income resulting from the risk of physical loss or damage due to the Coronavirus.
• Some insurance policies cover all risks of physical loss or damage – a broad coverage grant provision which provides coverage unless a particular exclusion exists in the policy.
• “All Risk” policies are interpreted by the Courts broadly in favor of coverage.
• Cases have held that physical loss or damage occurs when a hazardous condition renders the insured property unsafe or that the property cannot be used for its intended purpose.
• Direct physical loss may occur in the absence of structural damage to the insured’s property.
• Some commercial policies may also contain coverage provisions which may cover Coronavirus related losses.

 
In the event that you have suffered a loss which is potentially covered, notice of the loss should be provided to the insurance carrier and consideration should be given to filing a claim based upon a careful review and analysis of the coverage granted in the coverage grant provisions of the insurance policy as well as the exclusions and endorsements contained within the policy.