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COVID-19 and widespread denials of business interruption coverage

Since the stay-at-home orders began in March, non-essential businesses have taken significant hits to their bottom line. With nowhere to turn for assistance, apart from temporary federal relief, business owners are looking to their insurance companies for help.

Unfortunately, many insurance companies are denying policy holders' claims amid the pandemic. And the result is a series of lawsuits from owners of restaurants, bars, gyms and other businesses, including retail and non-essential medical and dental.

According to a recent Forbes publication, there are some states that have mandated insurance refunds for workers' compensation and automotive premiums. But that will simply not be enough. The pandemic's hit on businesses is widespread, impacting numerous industries and threatening small and big businesses alike. For example, restaurant transactions in early April dipped more than 40% and there is nowhere for their owners to turn.

Insurers are trying to justify many denials by pointing to an exception in their business interruption policies for viruses and other related epidemics. Indeed, insurance companies are even denying claims in which there is no language specific to virus exceptions. This is wrong because insurance companies are supposed to protect the assets of those policyholders who put their trust in them.

That is why these actions by insurance companies can be challenged. If your business interruption insurance claim is denied, you may have cause for legal action. This is best done with help from attorneys who are highly skilled in litigation. If you are a business owner whose business is suffering from the COVID-19 pandemic and you are denied coverage or are unsure whether you have business interruption insurance, it makes sense to talk with legal counsel about your rights and options.

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McGlynn, Glisson & Mouton
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Baton Rouge, LA 70801

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