A court in Missouri has reached a momentous ruling pertaining to COVID-19 business interruption claims. According to a news report, U.S. District Court Judge Stephen Bough for the Western District of Missouri ruled that business income loss due to the coronavirus might be covered under standard property and casualty policies, as long as the claimant can prove direct physical loss.
Why This Decision is Momentous
This decision provides a possible roadmap for businesses that have been affected by COVID-19 closures. While the decision made by Judge Bough is still subject to appeal, the order serves as persuasive authority supporting policyholders’ efforts to secure business interruption coverage for loss of profits and other business income during the coronavirus closures, which is devastating businesses of all sizes.
This is an important ruling because it is the first positive pro-policyholder decision on the issue of business interruption. Until now, there have been only three written decisions on this issue and all have come out in favor of insurers. This is an important decision for policyholders because it gives them hope that there is a path toward recovery in this type of litigation. Thousands of business interruption lawsuits have been filed around the country.
There is Still a Lot of Work to be Done
While this is a good victory for business owners and gives them some hope for recovery, it is important to remember that there are still challenges. First and foremost, if your business suffered losses as a result of COVID-19 closures, you must make a claim to your carrier. If your carrier denied it, then you can file a lawsuit. The decision in Missouri says that as a matter of law, businesses can make a claim that an insurance company breached its contract. However, businesses will need to present evidence that they have suffered physical damages as a result of the virus.
This is why businesses need an experienced business interruption lawyer on their side who can help build their case and help ensure that they receive fair compensation for the tremendous losses they have suffered as a result of this global pandemic. Insurance companies should step up and do the right thing – compensate these businesses that have faithfully paid their insurance premiums for years hoping their interests would be protected during a crisis.