00:04
the two primary
00:06
uh impediments or what i would call
00:08
triggers to
00:10
business interruption coverage in most
00:13
commercial general reliability policies
00:16
are one
00:17
in order to trigger the coverage almost
00:20
all of these cgl policies have a
00:23
requirement of some form
00:25
of personal property damage loss
00:28
at a business premise or within a
00:31
certain geographical proximity
00:33
to the business premise and so if you
00:36
cannot prove that you’ve had
00:38
some personal property damage at your
00:41
business
00:42
or within a geographical proximity to
00:45
your business
00:47
the business interruption coverage is
00:50
not triggered
00:51
in the cgl policy there have been over
00:54
1100 lawsuits filed in the united states
00:58
since march seeking to
01:02
recoup monies on business interruption
01:04
claims
01:05
on commercial general liability policies
01:09
and i’m not aware of one case where an
01:12
insurance company has not sought to at
01:15
least
01:16
claim that there is no personal property
01:20
damage loss as a result
01:22
of covet itself or sought to dismiss a
01:26
complaint
01:27
there have been numerous opinions
01:30
in multiple jurisdictions by judges
01:34
refusing to dismiss lawsuits
01:38
on the basis that covet in and of itself
01:41
does not constitute personal property
01:44
damage
01:45
there’s a case that uh kind of a root
01:47
case that emanated
01:48
a business interruption claim involving
01:51
travelers insurance with the
01:53
manufacturing industrial plant
01:56
where there was an ammonia leak and the
01:58
civil authorities shut down the plant
02:00
claiming that the ammonia gases were
02:02
dangerous
02:04
and the business owner brought a
02:06
business interruption claim
02:08
travelers denied the claim asserting
02:10
that ammonia gas
02:11
in and of itself is not something that
02:14
is personal property damage and
02:16
therefore you can’t pursue
02:18
or you can’t trigger the business
02:19
interruption coverage the court in that
02:21
case
02:22
denied the motion to dismiss and
02:25
basically
02:25
said that the personal property damage
02:27
does not have to be
02:29
something that you can physically see it
02:31
doesn’t have to be a broken window a
02:33
broken chair a burnt down building
02:35
that obnoxious dangerous gas emanating
02:39
or floating through the air
02:40
would be enough to trigger at least the
02:43
personal property damage requirement
02:45
and there have been numerous courts in
02:48
the united states that have adopted
02:50
the position that covet 19 that the
02:54
virus in and of itself
02:55
attaching to surfaces is sufficient
02:59
to trigger the personal property damage
03:01
requirement
03:02
the second impediment is
03:06
some of the policies contain a virus
03:09
exclusion or virus exception
03:12
that will provide an effect that
03:16
no matter what the damage emanates from
03:18
whether you can
03:20
prove that you have personal property
03:22
damage that the insurer will not cover
03:24
any loss whatsoever that is in any way
03:27
related
03:29
to a virus and that
03:32
exception emanated out
03:35
of sars when sars
03:39
infected america in the united states
03:42
there were numerous business
03:43
interruption claims brought on cgl
03:46
policies and all those claims were paid
03:48
there’s no case law that i’ve been able
03:51
to find
03:52
or any of the other attorneys i know
03:53
that are handling business interruption
03:55
lawsuits have been able to find that
03:58
emanated out of
03:59
an insurer’s failure to pay business
04:01
interruption claims due to sars
04:04
after all those claims were resolved and
04:07
settled
04:08
the insurance companies decided that
04:11
they wanted to
04:12
change the coverage that was in their
04:15
policies
04:16
and so there’s a company that’s referred
04:19
to as iso
04:20
which is a company that basically
04:23
authors
04:24
standard commercial general liability
04:26
insurance policy forms
04:28
that almost all the insurance companies
04:31
use to insure their customers
04:33
those forms get approved by all of the
04:36
various departments of insurance
04:38
in each jurisdiction so the state of
04:40
illinois department of insurance
04:42
will improve will approve hypothetically
04:45
one to three
04:46
iso forms that all the insurers
04:50
in the state of illinois must use
04:53
as one of the three of their forms for
04:56
for commercial general liability
04:58
policies well
05:00
in order to change the coverage from
05:02
those forms
05:04
the insurers have to file a petition
05:06
with the department of insurance
05:08
and they need to tell the department of
05:10
insurance what it is that they’re
05:11
seeking to change
05:13
in the form with the virus exception
05:16
what what we believe happened
05:18
is the insurance companies went to the
05:20
department of insurance
05:22
and said that they were were seeking to
05:25
clarify
05:26
existing coverage in the insurance
05:29
policies
05:30
to clarify that they were not going to
05:33
cover
05:34
any damages that resulted from in any
05:38
way shape or form a virus the department
05:40
of insurance
05:41
based on the representation from the
05:43
insurers
05:44
that they were clarifying existing
05:46
coverage
05:47
approved the policy amendments to add a
05:50
virus exclusion
05:51
to some not all of the commercial
05:54
general liability policies when an
05:57
insurer
05:58
seeks to clarify existing coverage
06:02
there’s no rate change from the
06:04
department of insurance if the insurers
06:07
notified the department of insurance
06:09
that they were seeking to take away
06:11
existing coverage
06:12
the department of insurance if approved
06:15
would have required the various insurers
06:18
to change the rates that they were
06:20
charging
06:21
to their customers within a given state
06:23
because they’re taking away coverage
06:26
that previously existed so we think
06:29
that the virus exclusion and i know it’s
06:31
a long answer to
06:33
to a kind of a two-part question but we
06:36
think that
06:37
equitable estoppel is another
06:39
affirmative defense that can be used
06:41
against the insurance companies
06:43
who are seeking to invoke virus
06:45
exclusions that might exist
06:48
in a cgl policies business interruption coverage