Bad Faith In The Age Of COVID-19: Lawsuits And Strategies As Businesses Remain Shut Down

As high-profile events are canceled, supply chains are disrupted, and millions of businesses throughout the country are ordered to close their doors—all to mitigate the spread of COVID-19—the dire economic consequences continue to escalate.

Virtually every sector of the economy has been impacted by this pandemic. The businesses most severely affected include hotels, retail, restaurants and bars, convention and event organizers, casinos, theme parks, gyms, and movie theaters.

While there are many uncertainties concerning the coronavirus pandemic, one thing is clear: Businesses will aggressively pursue insurance claims in an attempt to minimize their financial losses.

And as the stakes get higher, insurers will undoubtedly find themselves under fire, facing a deluge of coverage and bad-faith litigation.

Insurers must use care to fairly investigate and evaluate claims for coverage arising from the pandemic to avoid liability for bad-faith claim handling.