Billions In Losses Spur Insurance Claims; Civil Authority Clause To The Rescue?

Barbara Snowden dreamed of opening a wig shop to help women who’d lost their hair during chemotherapy feel better as they battled cancer. In November, she beamed at the grand opening of Hair Goals Club in the Houston suburb of Humble, Texas.

But four months later, her dream died when local officials ordered all non-essential services closed to combat the spread of coronavirus.

Snowden had paid for insurance covering unexpected losses, but a quick answer came back on her claim: Nope. Like so many other small business owners in America, she was told her policy didn’t cover disruptions from a pandemic.

“I cried like a baby because I couldn’t believe it,” Snowden said. “That insurance was my last line of defense.”

Now it’s part of a legal fight that may reach every state over who should pay for the steep revenue losses from the deadly Covid-19 virus. Snowden is among a dozen business owners -- including celebrity chefs, Native American casino operators, restaurant chains, a scuba-diving shop and a movie theater operator -- who sued insurers for refusing to honor policies.