Anapol Weiss Shareholder Gregory Spizer was recently featured in The Legal Intelligencer discussing the timely news of business interruption claims. In his article, Insurers Refuse to Pay Business Interruption Claims Caused by Pandemic, Spizer discusses the currently widespread recent trend of insurance companies denying businesses’ interruption claims due to the coronavirus, and what businesses can do to fight back.
What a Business Should Do After Experiencing Interruption Losses
The first thing one must do is examine the language of business insurance policies, Spizer explains. “When interpreting insurance contracts, i.e., the policy, coverage is to be interpreted broadly, while exclusions should be interpreted narrowly.” This is because most of the time, and unless specifically excluded, policies provide coverage for all-risks including for the following business interruption losses:
- Damage that arises from a physical loss to the insured’s property
- Damage that arises from the actions of a civil authority barring “access” to the property.
Policies Favor the Insured
Additionally, insurance policies are almost wholly created by the insurance companies themselves, and purchasers of such policies typically don’t have the ability to change policy wording. “Given this inequity,” Spizer states, “the law requires insurers to act in good faith toward its insureds.”
What this means is that insurance policy carriers must be told in clear language what their policies cover, which has been spoken for in Pennsylvania’s Courts. Furthermore, any policy language that might be ambiguous must be interpreted in a favorable manner to the insured.
Defense by Insurance Companies
Yet as we speak, most insurance companies are denying claims relating to COVID-19 business losses. Their defense is that the virus doesn’t cause physical damage to property, such as a hurricane or tornado might. However, Spizer goes on to explain that because the governor of Pennsylvania ordered the shutdowns that impacted businesses, “…damage caused by this pandemic is indistinguishable from that caused by any other natural disaster.”
Gregory Spizer is a shareholder at the Anapol Weiss personal injury law firm. He handles mass tort, catastrophic injury, and first-party insurance cases. Anapol Weiss is actively representing a number of businesses that have sustained real and significant business losses as cases. If you or someone you know have suffered business interruption losses due to the pandemic, please contact us today for a free case evaluation.