Business Interruption Insurance Legal News & Safety Info

Business Interruption Insurance: Don’t Automatically Accept Your Insurer’s Blanket Denial

Evan G. Greenberg is the CEO of Chubb, one of the largest insurance companies in the world.  He wrote an op-ed that ran in the Wall Street Journal entitled “What Won’t Cure Corona: Lawsuits” (subscription required). It made me think – another thing that won’t cure the virus is insurance companies breaching their contract with small businesses across America by issuing blanket denials, often without even a cursory investigation of a business owner’s claim.

Chubb clearly is motivated to try and set the narrative: COVID-19 Business Interruption claims simply are not covered. The problem is that is far from settled fact.

Greenberg claims there must be physical damage to the property in order to have a covered loss. He says “The overwhelming majority of insured coverage requires physical damage such as a fire or flood that prevents the business from operating. Viruses aren’t covered.”

That is simply not true.  Many policies require “physical loss or damage.  What is “loss” if not the inability to use your property because of virus contamination – or even the risk of virus contamination.  In addition, many policies also include coverage for civil authority orders restricting use of property.   In either event, Chubb’s claim is not supported by many insurance policies that I have reviewed in recent weeks. And more importantly, Chubb does not get to single-handedly interpret the policy language in the manner most beneficial to his company. That is where the courts come in.

Naturally, Chubb and other insurance giants want business owners to take his word for it; to give up without a fight. That is what insurance company executives do. But that’s not what trial lawyers do. It is certainly not what I, nor my law firm do.

The U.S. Chamber of Commerce – through its Institute for Legal Reform – has clearly taken the side of the giant insurance corporations over the Main Street businesses that largely make up its membership. The ILR is trampling on the 7th Amendment rights of its members.

I am a fierce Seventh Amendment advocate. The Seventh Amendment is an individual’s right to a jury trial. In my home state of Missouri, the state legislature is considering legislation on big business’ cause of “legal reform.” I wrote my own op-ed in the Kansas City Star on the subject. The Cliff’s Notes version is that the Seventh Amendment of the United States Constitution is the linchpin for all our other constitutional rights.

The remedy, when our rights have been violated, or when there is a dispute or disagreement, is a trial in front of an impartial jury of our peers. A trial court is the one place in this country where a small business owner is on equal footing with a multi-billion dollar, multi-national company like Chubb.

When an insurance company breaches its contract, the right to jury trial evens the playing field.  The right to jury trial allows small businesses affected by the COVID-19 outbreak to take on the insurance companies that are supposed to provide protection.

The insurance industry collected $1.22 trillion in premiums in 2018 – now it is abandoning the customers who paid those premiums when they need protection the motion.

Greenberg, speaking for Chubb, has vowed to fight these business interruption claims “tooth and nail.”  When they do – we’re here to help.

So many friends are struggling with businesses that have slowed or been completely shut down.  These policies are complex and there are traps set in the language that favor the insurance companies.  We are here to help businesses examine their policy language, submit claims, and fight wrongful denials.  We are here to help our businesses get the protection they paid for.