COVID-19 Coverage Disputes? Let’s Let The Courts Decide

On March 18, 2020, a bipartisan group of U.S. House members asked the insurance industry to retroactively recognize financial losses relating to COVID-19 as covered claims under commercial property insurance policies that either explicitly or implicitly do not provide such coverage.

Subsequently, the state legislatures in Ohio, New Jersey, Pennsylvania, Massachusetts and New York (more are sure to follow) proposed legislation mandating the same coverage, either retroactively or prospectively.

These actions by federal and state legislatures reveal a profound underestimation of the complexity of the insurance business and pose a serious threat to a vital component of the U.S. economy.

It is easy to forget that insurance is a very complicated business.

The industry calculates the future frequency of damage, destruction and loss of life for millions of people and businesses in thousands of occupations and industries against a backdrop of varying geography and disparate circumstances.