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Businesses Take Legal Action Against Insurance Companies Denying Coverage During COVID - YouTube
Channel: The Ring of Fire
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Has your dishwasher died from overuse? Are聽
you having trouble replacing it? Are you聽聽
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having trouble finding home exercise equipment?聽
Almost every industry has suffered supply chain聽聽
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interruptions while we're all in stay at home mode聽
and demand changes have many industries at death's聽聽
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door example, movie theaters. Poetically, No Time聽
To Die is the James Bond thriller that sat on the聽聽
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shelf for two years now and Hollywood is just one聽
business sector in which companies on the edge,聽聽
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or are on the verge of the edge, are taking legal聽
action against insurance companies who sold them聽聽
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business interruption insurance. Ty Childress聽
was lead lawyer for world trade center properties聽聽
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during the 9/11 insurance litigation aftermath聽
and he tells the Hollywood reporter that there聽聽
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are well over a thousand coverage cases across the聽
country already. And we're still in act one of the聽聽
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play. There are exponentially more policy holders聽
in the claims process right now. You know what聽聽
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happens if you miss an insurance premium payment,聽
but will insurers get away with what could be聽聽
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a cascade of claims that they stiff? Let's ask聽
attorney Sara Papantonio from the Levin Papantonio聽聽
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law firm in Pensacola. Sara, fundamentally,聽
how does business interruption insurance work?聽
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Well Holland, business interruption insurance聽
is there to provide coverage when the day to day聽聽
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aspects of your business have been interrupted聽
by some unforeseen event. Basically, if you're聽聽
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forced to close down your business, this is the聽
type of insurance that's meant to cover that lost聽聽
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income. Now, oftentimes when we think of business聽
interruption insurance, we think of disasters,聽聽
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hurricanes, floods, fires, things that business聽
owners can't necessarily foresee or prevent.聽聽
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So our law firm is actually handling these聽
cases and what we found is that there are聽聽
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two different types of policies in terms聽
of this business interruption insurance.聽聽
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We've got the all risk policies and what that聽
means is that all losses are covered unless the聽聽
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insurance company has specifically stated that聽
it's not covered. And what we found is that聽聽
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many insurance companies don't have a specific聽
exclusion for their policies for pandemics, which聽聽
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means that with COVID-19 these businesses should聽
have coverage. Now, the second type of policies聽聽
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we've seen are the ones that have language聽
that's far more restrictive about coverage,聽聽
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especially in terms of this pandemic. Now those聽
policies are required that businesses suffer聽聽
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what we call a direct physical loss聽
as a result of some unforeseen event.聽聽
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Now the legal question then becomes with COVID-19,聽
is a virus a direct physical loss to a business聽聽
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and should these insurance companies聽
have to cover our business losses?聽
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As I have read about this, the insurance聽
industry's position, seems at least to this聽聽
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layman to be cry uncle. The insurance information聽
institute represents some of the biggest insurers聽聽
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in the world and their spokesperson says聽
pandemic related losses are generally聽聽
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uninsurable because they hit all businesses and聽
all at the same time. And if every business in the聽聽
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country is affected by the same catastrophe, the聽
insurance companies don't collect enough money to聽聽
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pay that out in losses. So they exclude it.聽
Sara, be the plaintiff, what do you say to that?聽
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They're telling the American people that聽
they don't have enough money. So then why聽聽
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have hardworking Americans been paying聽
these high premiums month after month,聽聽
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year after year only to be told by their insurance聽
company, sorry, we don't have enough money to聽聽
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cover the very loss that you have been paying us聽
to cover all this time. Holland, the very reason聽聽
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we have insurance companies is to support us, to聽
help us rebuild and to work through hard times.聽聽
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And what these insurance companies are doing is聽
turning their backs, trying to save themselves聽聽
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rather than actually providing the insurance for聽
the, the clients that they promised they would.聽
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One big reason for continuity of聽
business insurance is continuity,聽聽
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the ability to keep employees on the payroll聽
during a shutdown and this is acute for the mom聽聽
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and pop businesses who are bearing the brunt聽
of these pandemic protocols. We see how much聽聽
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trouble restaurants and bars are having and how聽
these owners agonize about letting people go,聽聽
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bringing them back, only to have to let them聽
go again. Sara, in David versus Goliath cases,聽聽
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do juries tend to favor David over Goliath,聽
the big guy, or is that a caricature?聽
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Well, unfortunately we're not, we're not really聽
going to see a wave of successful verdicts across聽聽
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the United States. And when we're talking about聽
juries, what we have to look at is what we call聽聽
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a reptilian thought processing and that, what that聽
means is that when juries are evaluating a case,聽聽
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what they think about when they're聽
making this decision, isn't, you know,聽聽
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the facts in front of them, it's how it's going聽
to affect them in the long run. And what insurance聽聽
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companies have done so well at is what they,聽
they, they pushed this narrative that juries,聽聽
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you know, that if they award big verdicts, that in聽
the long run, it's not going to help mom and pop,聽聽
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but it's going to hurt them because聽
it's going to raise their premiums.聽聽
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So while, you know, we hope that that聽
juries will, will rule in our favor,聽聽
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what it really depends on, what it comes down聽
to is where these cases are being tried, because聽聽
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it fundamentally depends on the location in聽
which these are being tried. If juries are more聽聽
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in an area where they've suffered catastrophic聽
disasters, then what's going to happen is they're聽聽
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going to see firsthand how insurance聽
companies are taking advantage of them.聽
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Yeah. We're speaking with attorney Sara聽
Papantonio, Levin Papantonio law firm.
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