Hartford Financial Services Coverage for Covid-19 Closures Class Action

Because of the Covid-19 pandemic, people have been told to stay at home, nonessential businesses have been closed, and large gatherings are prohibited. These requirements have been disastrous for businesses. The complaint for this class action alleges that business insurers, like the Hartford Financial Services Group, Inc. and Sentinel Insurance Company, Ltd. should pay out benefits to insured businesses that have business interruption coverage.

The Nationwide Class for this action is all entities in the US that have standard all-risk commercial property insurance properties with Hartford that provide Business Income, Civil Authority, and Extra Expense coverages and do not exclude coverage for pandemics, and who have suffered losses due to measure put in place by civil authorities to stop the spread of Covid-19. A New York Subclass has also been defined, for insurance policies on properties in New York.

On January 30, 2020, the World Health Organization named the Covid-19 outbreak a Public Health Emergency of International Concern. A month and a half later, the President of the US proclaimed the disease was a national emergency. The virus has, as of the filing of this complaint, been responsible for more than a million infections in the US and more than 57,000 deaths. New York State has been one of the hot spots for the disease, with more than 295,000 confirmed cases and 22,000 deaths.

In New York State, Governor Cuomo has issued orders restricting business and social activities. Bars and restaurants are also to stop serving food on their premises until further notice. All non-essential businesses in the state were closed as of March 22. Non-essential gatherings of individuals of any size for any reason have also been canceled or postponed.

The plaintiff, Food for Thought Caterers Corp., operates a full-service catering business serving the New York City area. Needless to say, the governor’s orders have caused high losses for the business.

Food for Thought is insured under an all-risk Hartford Business Owners policy. According to the complaint, it covers “direct physical loss of physical damage unless the loss is specifically excluded or limited in the Policy.” It notes, “Among the coverages provided by the Policy, which is currently in full effect, is business interruption insurance, which, generally, would indemnify [Food for Thought] for lost income and profits in the event that its business was shut down.”

The complaint quotes extensively from the policy to allege that the caterer’s losses from its Covid-19-related closing should be covered.

Hartford has so far refused to cover the losses because, it contends, Food for Thought’s property had not suffered any direct physical loss and the losses were excluded by the Pollution exclusion, and other exclusions…” However, the complaint claims that the Pollution exclusion does not apply because Covid-19 is not a pollutant or contaminant.

Article Type: Lawsuit
Topic: Insurance

Most Recent Case Event

Hartford Financial Services Coverage for Covid-19 Closures Complaint

May 1, 2020

Because of the Covid-19 pandemic, people have been told to stay at home, nonessential businesses have been closed, and large gatherings are prohibited. These requirements have been disastrous for businesses. The complaint for this class action alleges that business insurers, like the Hartford Financial Services Group, Inc. and Sentinel Insurance Company, Ltd. should pay out benefits to insured businesses that have business interruption coverage.

Hartford Financial Services Coverage for Covid-19 Closures Complaint

Case Event History

Hartford Financial Services Coverage for Covid-19 Closures Complaint

May 1, 2020

Because of the Covid-19 pandemic, people have been told to stay at home, nonessential businesses have been closed, and large gatherings are prohibited. These requirements have been disastrous for businesses. The complaint for this class action alleges that business insurers, like the Hartford Financial Services Group, Inc. and Sentinel Insurance Company, Ltd. should pay out benefits to insured businesses that have business interruption coverage.

Hartford Financial Services Coverage for Covid-19 Closures Complaint
Tags: Business Insurance, Business Losses, Insurance