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Resulting-Loss Exception Does Not Restore Coverage For Faulty Workmanship

The faulty workmanship exclusion precludes coverage where the claimed damage is caused by or resulting from an act, error or omission (negligent or not) that relates to the design, specifications, construction, materials or workmanship.  Can coverage nevertheless be restored by the resulting-loss exception to the exclusion?  The Tenth Circuit recently addressed this question.… Continue Reading

A Word About Business Interruption Claims From Vandalism, Riot and Civil Commotion

The death of George Floyd is a national tragedy that should never have happened.  The winds of change are in the air and we can only hope that peace, understanding, justice and fairness for all will prevail.  What happened to George Floyd and the cries to end racial injustice, however, have been overshadowed in the … Continue Reading

What to Make of the Early COVID-19 Insurance Coverage Court Rulings

There are been at least two court rulings on the COVID-19 insurance coverage litigation.  In Pennsylvania, the Supreme Court denied the extraordinary request to consolidate COVID-19 cases under what is called Kings Bench Powers.  In New York, a federal court denied an emergency request for a preliminary injunction requiring an insurer to pay its policyholder … Continue Reading

COVID-19 and the Exclusion for Virus and Bacteria

Insurance policies contain coverage grants and exclusions.  Generally, the burden is on the insured in the first instance to prove that the insured’s loss comes within the insurance policy’s coverage grants.  If the insured proves that the policy covers the insured’s loss, then the burden shifts to the insurer to prove that a policy exclusion … Continue Reading

Anti-concurrent Clause and Faulty Workmanship Exclusion

Anti-concurrent clauses preclude coverage even where the loss is partially caused by a covered cause of loss.  This clause received considerable attention in hurricane-related coverage litigation following Hurricane Katrina.  In a recent case, the Eighth Circuit Court of Appeals addressed the anti-concurrent clause in the context of damage allegedly caused in part by faulty workmanship.… Continue Reading

No Coverage for Breach of Contract Claim Under Commercial General Liability Insurance Policy

One of the most difficult things to understand as a policyholder is that a commercial general liability insurance policy (“CGL”) does not provide coverage for everything that might happen to the insured business, including being sued.  While the CGL policy has often been described as providing “litigation insurance” in addition to coverage for occurrences and … Continue Reading

Is a COVID-19 Stay-Home Order Alone Enough to Trigger Business Interruption Coverage?

Back in March, when the novel coronavirus was spreading and local and state governments were issuing stay-home orders, we published a blog post on Civil Authority Orders and COVID-19 Coverage.  Since that time, there have been over 125 lawsuits filed by insured businesses, many of them arguing that the economic damages caused by these COVID-19 … Continue Reading

COVID-19 Insurance-Related Blogs and Articles for March and April 2020

During March and April, the Squire Patton Boggs insurance group has authored several blog posts, alerts and articles on the insurance and reinsurance issues arising from the novel coronavirus pandemic.  These range from regulatory updates, to business interruption coverage analysis, to reinsurance issues.  We thought it might be good to list them here in one … Continue Reading

Does the Novel Coronavirus Cause Direct Physical Loss of or Damage to Property?

In previous blog posts and articles, we have discussed “business interruption” insurance and the typical requirement that there be “direct physical loss of or damage to property” for that coverage potentially to apply.  In this blog post, we examine the physical damage trigger further.  Why?  Because it is a central issue in the rapidly multiplying … Continue Reading

Fighting State COVID-19-Related Insurance Coverage Mandates

The novel conronavirus pandemic and the massive number of COVID-19 diagnoses have led to governmental orders closing down most non-essential businesses throughout the country.  These closures have also brought about thousands of business interruption claims by these businesses against their commercial property insurance policies.  Because most of these policies do not provide coverage for a … Continue Reading

Can Fear or Emotional Distress Associated With COVID-19 Be a “Bodily Injury”?

With the United States now having the highest number of confirmed infections in the world, the nation now finds itself in the throes of the COVID-19 pandemic. In this blog post, we continue to explore potential COVID-19 insurance coverage issues, this time focusing on whether fear of contracting COVID-19 alone or emotional damages caused by … Continue Reading

No Coverage for Insured’s TCPA Defense Says Pennsylvania Federal Court

Policyholders will look to their insurers when they are sued for unsolicited faxing under the Telephone Consumer Protection Act (“TCPA”).  Do they have insurance coverage?  That depends on the policy, but TCPA coverage is hard to come by.  That doesn’t stop policyholders from trying.  In a recent case, a Pennsylvania federal court put an end … Continue Reading

COVID-19 Coverage Litigation Escalates

As the COVID-19 pandemic brings about more shutdown orders, non-essential businesses that have been shut because of government orders are fighting to obtain insurance coverage.  The first four cases brought were declaratory judgment actions seeing orders that their policies covered the suspension of their businesses.  The latest case, however, goes a two steps further and … Continue Reading

Whether a Partial or Complete Cessation of Business Is Required for BI Coverage – COVID-19

With the COVID-19 pandemic showing few signs of slowing down in the immediate future, reality is starting to settle in on businesses and governments. As Congress and various state legislatures continue to discuss legislation aimed at remedying the economic damage caused by the pandemic, many businesses are grappling with extensive interruptions to their operations. In … Continue Reading

Actual Cash Value: Is the Cost of Labor Part of Depreciation? The Courts Are Divided

Depreciation typically is deducted from the actual cash value (“ACV”) of property when the insured elects to have its property damage claim paid on an ACV basis.  No one doubts that depreciation includes the cost of materials.  The question is, however, whether the cost of labor can be depreciated as well.  In a few recent … Continue Reading

COVID-19 and Waiting Periods Under Business Interruption Coverage

As the COVID-19 pandemic continues, businesses and governments are acting to flatten the curve.  Recently, California, the largest state by population, implemented an extensive quarantine statewide, affecting over 40 million people.  New York and other states and municipalities also have issued similar closure orders.  In this blog post, we continue to examine the issues surrounding … Continue Reading

Civil Authority Orders and COVID-19 Coverage

The COVID-19 pandemic is ongoing and local and state governments are issuing directives closing restaurants, movie theaters, gyms and other businesses.  Some local governments have even issued shelter-in-place orders.  In other instances, some businesses have begun closing their doors as a preemptive measure, either to reduce the spread of the virus or in response to … Continue Reading

Can Coverage for COVID-19 Be Excluded?

Business insurance policies contain exclusions precluding coverage under specified circumstances. Two exclusions potentially relevant to COVID-19 claims are the virus, bacteria or communicable disease and pollution exclusions. In this blog post, we examine these exclusions in the context of coverage issues for COVID-19.… Continue Reading

Businesses Scramble to Assess Insurance Coverage for COVID-19

COVID-19 has sickened hundreds of thousands of people and resulted in the deaths of thousands. Millions will likely be affected. Up until very recently, there was widespread belief that some countries may be spared the level of disruption seen earlier this year. Recent events have shown this is no longer a reasonable assumption. The WHO … Continue Reading

And So It Begins: The COVID-19 Coverage Cases Start

The first insurance coverage case has been brought by a restaurant in New Orleans seeking a declaratory judgment against its insurer, as well as the governor and the state, that the restaurant’s insurance policy does not contain an exclusion for viral pandemic and that the policy will cover the restaurant for any future civil authority … Continue Reading

The Facts Matter in Prospective Coverage Disputes Over COVID-19

There are two main questions in every insurance coverage dispute.  First, what are the actual facts that gave rise to the claim?  Second, what are the actual words contained in the specific insurance policy provisions relevant to the claim?  The facts and words matter because, more often than not, each claim and each policy has … Continue Reading

Breach of Fiduciary Duty and Negligent Misrepresentation Is Not Property Damage

To obtain coverage under a property insurance policy there has to be property damage caused by an occurrence during the policy period.  Seems simple, but as we have seen, sometimes the round peg just does not fit in the square hole.  In a recent case, the Ninth Circuit addressed whether allegations of breach of fiduciary … Continue Reading

Misrepresentation Results in Loss of Coverage

One of the best ways for a policyholder to lose its insurance coverage is to conceal or misrepresent material facts and circumstances about the claim.  In a recent case, the Sixth Circuit Court of Appeals affirmed summary judgment in favor of the insurance company dismissing a policyholder’s claims against its insurance carrier for not paying … Continue Reading

Does Physical Loss or Damage Include Loss of Use, Reliability or Impaired Functionality?

Cyber attacks on computer systems have spawned myriad coverage disputes over whether the data stored on the computer system tangible property that comes within property insurance coverage or whether the computer system has to be rendered unusable.  As cyber attacks have grown and morphed from hacking to ransomware to other types of intrusions, and as … Continue Reading
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