Valley Forge Insurance Denial of Claims for Covid-19 Closures Class Action

With the Covid-19-related closures of many business in the US, companies have lost income, and some of them are looking to insurance policies to make up the loss. The complaint for this class action alleges that Valley Forge Insurance Company should pay for the lost income of its insureds with certain coverages, including Business Income, Extra Expense, Extended Business Income, and Civil Authority coverages.

The plaintiff in this case, Jae Y. Hong, DDS, PS, has an oral and maxillofacial surgical dental business operated out of two locations in the state of Washington. The business was insured under one or more policies with Valley Forge.

Due to the coronavirus pandemic, Washington’s Governor Jay Inslee issued a number of proclamations and orders to curb the spread of the disease.

On March 19, 2020, he issued a proclamation entitled “Restrictions on Non-Urgent Medical Procedures.” The proclamation addressed the shortage of personal protective equipment (PPE). It said, in part, “To curtail the spread of the Covid-19 pandemic in Washington State and to protect our health care workers as they provide health care services, 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[.]”

This meant that the plaintiff’s business could no longer offer services except in cases of emergency. Because of this, the business has sustained losses. The complaint alleges, “Plaintiff’s property will continue to sustain direct physical loss or damage covered by the Valley Forge policy or policies, including but not limited to business interruption, extra expense, interruption by civil authority, and other expenses.”

In addition, the complaint says, the business’s “property cannot be used for its intended purposes.”

The business has already applied to Valley Forge for coverage of its losses. However, Valley Forge rejected its claims and would not pay for the losses.

Eight classes have been defined for this action:

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

A Washington State Subclass has been proposed for each class.

The Business Income Breach of Contract Class is all persons and entities in the US with a Valley Forge 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, whose Business Income claims have been denied by Valley Forge.

Full definitions of all the classes may be found on pages 6-9 of the complaint at the link below.

Article Type: Lawsuit
Topic: Insurance, News

Most Recent Case Event

Valley Forge Insurance Denial of Claims for Covid-19 Closures Complaint

June 9, 2020

With the Covid-19-related closures of many business in the US, companies have lost income, and some of them are looking to insurance policies to make up the loss. The complaint for this class action alleges that Valley Forge Insurance Company should pay for the lost income of its insureds with certain coverages, including Business Income, Extra Expense, Extended Business Income, and Civil Authority coverages.

Valley Forge Insurance Denial of Claims for Covid-19 Closures Complaint

Case Event History

Valley Forge Insurance Denial of Claims for Covid-19 Closures Complaint

June 9, 2020

With the Covid-19-related closures of many business in the US, companies have lost income, and some of them are looking to insurance policies to make up the loss. The complaint for this class action alleges that Valley Forge Insurance Company should pay for the lost income of its insureds with certain coverages, including Business Income, Extra Expense, Extended Business Income, and Civil Authority coverages.

Valley Forge Insurance Denial of Claims for Covid-19 Closures Complaint
Tags: Business Insurance, Covid-19 Related, Denial of Benefits, Insurance