Coronavirus Business Interruption Insurance Lawsuit

Are you afraid of experiencing a business interruption or some other type of loss that could put your company out of commission for an extended period? You may be able to recover from it with the help of insurance, but there are many companies who don’t offer this coverage.
The lawsuit alleges Yum! Brands and its subsidiaries refused to sell Coronavirus Protection Plans after customers voiced their concern about contracting the disease in China where Yum operates restaurants. The plaintiffs claim they were forced into bankruptcy because they couldn’t afford to cover their losses without those plans available.,
With so much happening around blockchain technology, recent lawsuits have caught people’s attention like never before.,
Blockchain is quickly becoming one industry’s solution (or problem) when facing financial issues related to startup errors or business interruptions. Alongside cryptocurrency, companies can use decentralized ledgers make transactions more transparent and prevent fraud by keeping sensitive data safer than ever before..

The “covid-19 business interruption cases” is a lawsuit filed by the Covidien Company against Baxter Healthcare Corporation. The lawsuit alleges that Baxter made false claims about the safety of its product, which led to a significant decrease in sales for Covidien.

Coronavirus Business Interruption Insurance Lawsuit

What is Business Interruption Insurance, and how does it work?

Business interruption insurance, often known as company continuity insurance, protects business owners from losing revenue due to a catastrophe such as a fire or natural disaster.


According to Investopedia, business interruption insurance is not offered separately and is typically added to a property/casualty policy or included as an add-on in a complete package policy.

Business interruption insurance is designed to protect companies until the conclusion of the business interruption term, as specified by the policy. In most instances, this is defined as the date on which the property has been restored, if repairs are required, and can operate as it did before the catastrophe that caused the business interruption in the first place.

Insurance companies cover the business’s lost revenue, as well as its operational costs, wages, taxes, and loan payments, up to the insurance policy’s maximum.

Coronavirus Causes Business Disruption

Coronavirus has affected companies all around the globe, and many have had to reduce their hours, lay off workers, or even close their doors completely as states throughout the nation have required that all except “vital enterprises” stay open.

According to a recent Goldman Sachs poll, roughly 51 percent of small company owners in the United States believe they will only be able to stay open for three months at most if the pandemic continues, while a startling 96 percent say they are already experiencing the impacts of the coronavirus.


Many of these company owners cite lower sales as a reason for their decision, while others claim that telecommuting is not an option. Only 13% of small business owners are optimistic that they will be able to fulfill their company’s requirements in the future. More than 1,500 small company owners from around the nation participated in the Goldman Sachs study.

Read more about Kid Boutique files a lawsuit against Travelers Business Interruption Insurance. 

Why were the claims denied by the insurance company?

Many company owners may believe that their business interruption insurance coverage will kick in or at least be an option if their firm is disrupted by the coronavirus.

However, an increasing number of company owners who have submitted claims for business disruption as a result of the coronavirus epidemic are having their claims rejected. Insurers argue that these insurance cover physical loss or property damage that forces a company to shut due to catastrophes such as hurricanes, rather than a pandemic. The policy’s wording may be directly linked to property damage and destruction.

Some insurance providers are refusing to pay these business continuity insurance claims unless there is a direct physical damage to the property that causes it to close.

Read more: Should Business Interruption Insurance Coverage Be Provided During COVID-19?

Lawsuits Regarding Coronavirus Insurance Coverage

By filing coronavirus insurance coverage claims, some company owners have started to fight back against their insurers, in some instances pursuing coronavirus litigation.

For example, the Oceana Grill in New Orleans filed a coronavirus lawsuit, claiming that its insurer, Lloyd’s of London, is obligated to pay coronavirus losses due to its “all risk” policy. According to the restaurant, the policy’s provisions include the expansion of coverage to the company for damages incurred as a result of a civil authority-ordered business shutdown.

Read more about Treasure Island Las Vegas is suing for COVID-19 coverage.

What effects have the lawsuits claimed to be caused by the Coronavirus?

Coronavirus impacts, according to the Oceana Grill restaurant, include physical harm to the company.

“The coronavirus is recognized by the scientific community and people directly afflicted by the virus as a source of actual bodily loss and harm,” Oceana Grill said.

Several nations, including France, Italy, and Spain, have started cleaning and fumigating public spaces before allowing them to reopen, according to the restaurant. The complaint further claims that since their insurance does not expressly exclude a viral pandemic, the claim for coverage cannot be lawfully rejected.

“I can’t fathom how defense counsel would go into court and argue that coronavirus doesn’t cause property damage or contamination,” plaintiff’s lawyer told the Insurance Journal recently.

The Coronavirus business disruption lawsuit claims that the virus’s impacts are “physically affecting public and private property, and physical places in cities across the globe.” “Any attempt by Lloyd’s to deny that the virus causes physical harm and loss would be a misleading and potentially fraudulent misrepresentation that may put policyholders and the general public in risk.”

Some restaurants and other businesses are facing a sad reality: they may not be able to reopen their doors once the epidemic is gone because they do not have business interruption coverage.

With no insurance to cover the loss of income, companies still having to pay rent, and no clear notion when this scenario will end, some worry that an increasing number of small businesses and restaurants may close permanently, according to a recent article by the Denver Post.

Read more: Coronavirus Business Losses Denied Unfairly to California Taco Shops

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  • upenn covid litigation tracker