Thwarting insurers’ campaign to duck interruption compensation obligations to businesses

Fill in the blank and you’ll understand the public relations campaign the insurance industry uses over and over to maintain record profits by shirking obligations to their premium-paying customers and pass the buck to  taxpayers: “If you make us pay ______ claims we’ll go bankrupt.”  Floods, earthquakes, terrorism, business interruption due to the pandemic…the list just keeps growing.  For the sake of our nation’s economy and the well being of our population, this buck-passing has to stop.  Governments and communities have done their share to support people and businesses through the pandemic – insurers must too.

Insurers collected $2.4 billion in premiums for business interruption coverage the year before the Coronavirus interrupted the operations of thousands of their customers across the United States.  They’d paid business claims arising out of previous public health crises. But instead of investigating and paying customers’ claims in 2020, insurers cried poverty from the get-go, mounted a coordinated campaign to convince courts, public officials and anyone who would listen that tagging them with honoring any claims, regardless of policy language, would put the entire industry under.

Using all the formidable lobbying, litigation and legislative resources at their disposal, insurers have done an incredible job at obscuring the truth: The truth is, indemnification in case of loss should be effectuated wherever possible. Policy language differs and must be analyzed case by case.  Policy exclusions are to be construed narrowly and coverage broadly. For 50 years courts have upheld coverage for losses caused by things you can’t see and air is business property. Judges are jurists, not scientists. Many of the business interruption policies insurers collected 2.4 billion in premiums for should be covering business losses due to interruptions caused by public safety orders and the damaging impact of the virus.

Through our COVID-19 Loss Recovery working group, attorney volunteers from the top echelons of the policyholder bar have worked together for over a year to thwart insurers’ national strategy to wholesale reject all claims and defeat their customers in court actions.  Earlier this week UP and two of our volunteers testified in support of Massachusetts legislation that would establish a rebuttable presumption that the presence of virus on the premises of a business constitutes property damage.  A simple concept that would go a long way to leveling a playing field that has been dominated by insurers due to their public relations campaign, superior lobbying and litigation resources and the business advantages they enjoy as drafters of adhesive contracts that businesses must buy.  For more info, click here.