Insured Faults Policy Language In Business Interruption Suit

A downtown Washington, D.C. grilled cheese restaurant launched a class action lawsuit against its insurer after it denied claims for lost income.

The restaurant, GCDC Grilled Cheese Bar, filed a complaint against Hartford Financial Services Group and Sentinel Insurance Company, alleging the insurer wrongly rejected its claim for losses incurred during mayoral-mandated COVID-19 shutdowns.

As NPR reported, “the suit is part of an expected wave of litigation spurred by the pandemic.”

Business interruption claims have been trickling in among many different retailers that were forced to shutter their doors or reduce face-to-face operations amid the COVID-19 outbreak in the United States.

Because a typical business interruption policy is triggered by a physical event, such as shutdown due to a flood or fire, many insurers have denied claims for monetary restitution for impacted organizations.