Will Your Customers Prevail on COVID-Related Business Interruption Insurance Claims
Many customers of Delaware banks have suffered unprecedented economic losses from restrictions imposed on businesses by Governor Carney related to Delaware’s State of Emergency, which he declared on March 12, 2020 due to the public health threat caused by COVID-19. Good bankers always keep a close eye on their customers’ financial health, and many become trusted advisors to those customers in protecting that health. A great debate arose a year ago as to whether businesses should be filing claims under their property insurance policies to cover COVID-19-related losses. The conventional wisdom was that insurers would not pay such claims. Indeed, insurance claims under various theories to recover lost business income due to COVID-19 were routinely denied, and such denials were then tested in an absolute flood of litigation throughout the country over the past year. The fact that these cases number in the thousands is no doubt a testament to the wide-spread effect of various governmental closure orders and other restrictions on businesses. Now that many courts have weighed in on COVID-19 coverage, where do businesses stand on recovering money from their insurers?