Selective Insurance Co of the SE No Covid-19 Coverage Pennsylvania Class Action

Many businesses have lost income due to the enforced Covid-19 closures. In this class action, one such business alleges that its insurer, Selective Insurance Company of the Southeast, should pay for such losses under its Business Income, Extended Business Income, Extra Expense, and Civil Authority coverages. Selective has denied the claim.

The plaintiff in this case, Frank Van’s Auto Tag, LLC, operates in two locations in Penndel and Philadelphia, Pennsylvania. Frank Van’s is insured under a policy from Selective.

The complaint quotes the Business Income coverage part as saying, “We will pay for the actual loss of ‘Business Income’ … you sustain due to the necessary ‘suspension’ of your ‘operations’ during a ‘period of restoration’” and that the loss must relate to a Covered Cause of Loss.

It quotes the Civil Authority coverage part as saying, “When a Covered Cause of Loss causes damage to property other than property at the described ‘premises’, we will pay for the actual loss of ‘Business Income’ and necessary Extra Expense caused by action of civil authority that prohibits access to the described ‘premises…’”

In addition, the complaint claims, “The policy’s Business Income, Extended Business Income, Civil Authority and Extra Expense provisions contain no exclusion for losses caused by governmental orders issued to prevent exposure to a virus.”

Frank Van’s had to close due to orders to prevent the spread of Covid-19 in Pennsylvania. Among them was a March 19, 2020 order from Governor Wolf that required all non-life sustaining businesses to stop operations and close physical locations.

According to the complaint, “[t]he Pennsylvania Supreme Court recently clarified that the Governor’s order has resulted in the temporary loss of use of non-essential business premises effected by the order, and that the order was issued to protect the lives and health of millions of Pennsylvania citizens.”

The complaint also claims, “There was no presence of the Covid-19 virus at [Frank Van’s] covered properties. [Frank Van] experienced a ‘Covered Cause of Loss’ by virtue of the Closure Orders, which denied use of the premises by causing a necessary suspension of operations during a period of restoration. The Closure Orders operate as a blockade that prevents employees and patrons from entering and operating the business for its intended purpose.”

The complaint defines four nationwide classes.

The Business Income Breach Class is all persons and entities that (a) had Business Income, Extended Business Income and Extra Expense coverage under a property insurance policy issued by Selective; (b) suffered a suspension of business related to the Closure Orders at the covered premises; (c) made a claim under a property insurance policy issued by Selective; and (d) were denied Business Income coverage by Selective for the suspension of business resulting from the Closure Orders.

The complaint also defines a Civil Authority Breach Class, a Business Income Declaratory Judgment Class, and a Civil Authority Declaratory Judgment Class. See the complaint linked below for further details.

Article Type: Lawsuit
Topic: Insurance

Most Recent Case Event

Selective Insurance Co of the SE No Covid-19 Coverage Pennsylvania Complaint

June 10, 2020

Many businesses have lost income due to the enforced Covid-19 closures. In this class action, one such business alleges that its insurer, Selective Insurance Company of the Southeast, should pay for such losses under its Business Income, Extended Business Income, Extra Expense, and Civil Authority coverages. Selective has denied the claim.

Selective Insurance Co of the SE No Covid-19 Coverage Pennsylvania Complaint

Case Event History

Selective Insurance Co of the SE No Covid-19 Coverage Pennsylvania Complaint

June 10, 2020

Many businesses have lost income due to the enforced Covid-19 closures. In this class action, one such business alleges that its insurer, Selective Insurance Company of the Southeast, should pay for such losses under its Business Income, Extended Business Income, Extra Expense, and Civil Authority coverages. Selective has denied the claim.

Selective Insurance Co of the SE No Covid-19 Coverage Pennsylvania Complaint
Tags: Business Insurance, Covid-19 Related, Denial of Benefits, Insurance