March 24, 2021


Business interruption (BI) claims stemming from the coronavirus pandemic have hit a new high.  A Florida federal court – see Urogynecology Specialist of Florida, LLC v. Sentinel Insurance Company, Ltd., No. 6:20-cv-1174-Orl-22EJK (M.D. Fla.) – recently determined that a “virus exclusion” does not prohibit a policyholder from pursuing insurance for COVID-related BI loss.  The policyholder sought to recover, under an “all risk” insurance policy, the losses resulting from its medical practice. The insurer moved to dismiss the lawsuit, arguing the policy expressly excludes losses caused by the virus.  The court sided with the policyholder and denied the insurer’s motion to dismiss.  

More than a year ago, the U.S. declared a national emergency in response to COVID-19.  States quickly followed with stay-at-home orders and lockdowns.  In March 2020, the governor of Florida issued an executive order declaring a state of emergency due to the pandemic, which forced policyholders to close their doors and cease normal business operations.

Due to the unprecedented COVID-19 pandemic, businesses suffered and continue to suffer substantial losses.  To recover for those losses, businesses have looked to their insurance policies.  Thousands of COVID-19 loss lawsuits are being heard in courts across the country, according to data from the University of Pennsylvania Law School.

Business Interruption (BI) Loss

BI coverage is a key source of protection for coronavirus-related business losses.  It reimburses policyholders for income lost as a result of “direct physical loss or damage to” covered property.  BI insurance, part of a property insurance policy, typically is triggered when property is damaged or unusable as a result of a natural disaster.  

Insurers may attempt to claim that policyholders are not entitled to BI coverage because the presence of the coronavirus on covered property does not constitute “direct physical loss or damage.”  Insurance companies want to reduce their liability exposure.  They are unconcerned with meeting their contractual obligations.  The stage is set for a battle between insurers and their policyholders over pandemic-related financial losses. 

Policyholders should closely examine with their attorney the specific language of coverages and exclusions and analyze how these provisions will be interpreted under the applicable law.  Even if a policy contains exclusions, policyholders should not accept insurers’ denials, delays or under-payment of pandemic-related claims at face value.  For your confidential case evaluation, contact Corless Barfield Trial Group at 813-258-4998.  

Court Rulings 

Recent decisions from Florida, Ohio, North Carolina, Oklahoma and Washington found coverage for BI losses arising out of COVID-19 even in the absence of changes to the physical structure of covered property.  The trend is for courts to interpret the relevant coverages broadly while construing related exclusions narrowly

In general, policyholders may receive more favorable rulings in state courts than in federal courts.   For example, several state courts in California have held that loss of property use could be enough to meet the physical loss or damage threshold.  Whereas in some federal courts, like Massachusetts and Arizona, federal judges found that a tangible property alteration was required, and that loss of use wasn’t enough.  

Different policies with different language, as well as factual differences and the dispute venue can result in a fragmented legal regime for these BI loss claims.  That is why you need an experienced insurance disputes attorney fighting aggressively for your rights.  


Business owners bleeding money during the coronavirus pandemic want their insurance to cover their losses.  That’s what they bargained for when signing a contract with their insurance company.  Insurance is there to help you prepare for the unknown.  But what happens when your insurance company doesn’t live up to their end of the bargain?  You hire Corless Barfield Trial Group. 

The insurance coverage landscape is changing on a daily basis as policyholders file new lawsuits to address business losses resulting from the pandemic.  For specific information on how your claim for insurance might proceed, how to assert property loss and damage, and insight into how different state and federal courts are ruling, call us today at 813-258-4998. 

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