In AMAG Pharmaceuticals, Inc. v. American Guarantee and Liability Insurance Company, the United States District Court for the District of Massachusetts held that a loose bolt or fitting that could be remedied simply by tightening it did not constitute “direct physical loss of or damage” to equipment covered under an all-risk property insurance policy.[1] About The Author
A trial level court in North Carolina recently found coverage under first-party property insurance policies for the insured restaurants’ COVID-19-related business income losses. In North State Deli, LLC et al. v. Cincinnati Ins. Co., et al., Case No. 20-CVS-02569 in the General Court of Justice, Superior Court Division, County of Durham, Judge Orlando F. Hudson, Jr. granted partial summary judgment to the plaintiff-insureds, finding that plaintiffs’ business income losses resulting from the governmental shutdown of its business constituted a “loss” to property, sufficient to trigger coverage under the Cincinnati policies. Although similarly situation insureds will undoubtedly rely on this decision in support of their claims for coverage, it is important to note that the North State Deli decision relies heavily…
Insurance claims arising out of COVID-19-related commercial losses have been hotly contested, and lawsuits have been filed across the country by policyholders seeking coverage for lost business income. These claims typically raise similar coverage questions – whether the spread of a virus could constitute “direct physical loss,” whether civil authority coverage is triggered, and whether virus exclusions preclude coverage. In Harvest Moon Distributors, LLC v. Southern-Owners Insurance Company, Case no. 6:20-cv-1026-Orl-40DCI, Judge Paul Byron of the U.S. District Court for the Middle District of Florida recently granted an insurer’s motion to dismiss in a different type of COVID-19 claim, relating to spoliation of product after a contract fell through. The insured, Harvest Moon Distributors, LLC (“Harvest Moon”), is a wine…
