Travelers Casualty Insurance No Covid-19 Loss Coverage Class Action

To prevent the spread of the Covid-19 pandemic, state governors have issued orders for the temporary suspension of nonessential businesses. Some of these businesses have lost significant income and are relying on their business income insurance to help make up their losses. This case brings suit against Travelers Casualty Insurance Company of America (TCICA), in hopes of ensuring payment.

The plaintiff in this case is Suneet S. Bath, DMD PS, a dentistry office located in Olympia, Washington, which does business as Impressions Dentistry Family Cosmetics. It was forced to suspend or greatly limit its business due to orders from Washington Governor Jay Inslee and other authorities.

For example, a March 19, 2020 Proclamation from Governor Inslee mentioned the “critical shortages” in personal protective equipment (PPE) for health care workers. The complaint quotes it as saying that, to address the shortages and curtail the spread of Covid-19, “it is necessary to immediately prohibit all hospitals, ambulatory surgery centers, and dental orthodontic, and endodontic offices in Washington State from providing health care services, procedures and surgeries that require personal protective equipment, which if delayed, are not anticipated to cause harm to the patient within the next three months[.]”

A later order prohibited “all non-essential businesses in Washington State from conducting business, within the limitations provided herein.” This proclamation is in force through May 31, 2020.

The company is insured under a Businessowners Coverage Policy with TCICA. The policy includes coverage for “direct physical loss of or damage to” the covered property. Within the definition of property damage is “loss of use.” The Businessowners Coverage Form includes Business Income Coverage, Extra Expense Coverage, Extended Business Income Coverage, and Civil Authority Coverage.

According to the complaint, the business has sustained “direct physical loss and/or damages” and will continue to do so, including “business interruption, extra expense, extended business interruption, interruption by civil authority, and other expenses.” The complaint alleges that the insurance should therefore cover these losses.

TCICA denied the dental office’s claim on April 1, 2020.

The complaint defines eight classes.

• The Business Income Coverage Breach of Contract Class is all persons and entities in the US insured under a TCICA policy with Business Income Coverage who suffered a suspension of their business at the covered premises related to Covid-19 or orders issued by governors or other civil authorities and whose business income claim was denied by TCICA.

The other classes are similar. Here is a list of all eight classes:

• Business Income Coverage Breach of Contract Class
• Business Income Coverage Declaratory Relief Class
• Extra Expense Breach of Contract Class
• Extra Expense Declaratory Relief Class
• Extended Business Income Breach of Contract Class
• Extended Business Income Declaratory Relief Class
• Civil Authority Breach of Contract Class
• Civil Authority Declaratory Relief Class

Each of the above classes has a Washington State Subclass. For further details, see pages 5-9 of the complaint linked below.

Article Type: Lawsuit
Topic: Insurance
Tags: Business Insurance, Covid-19 Related, Denial of Benefits, Insurance