Boston Bar Claims Westchester Surplus Lines Insurance Company Wrongfully Denied COVID-19-Related Claims

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A lawsuit filed by the operator of a Boston bar claims Westchester Surplus Lines Insurance Company has, “on a widescale and uniform basis,” wrongfully denied insurance claims for losses sustained after businesses were forced to close due to the COVID-19 outbreak.

The case claims that although the plaintiff’s insurance policy purportedly provided business income, civil authority, extra expense, and sue and labor coverage that should have applied to damages arising from the bar’s coronavirus-related closure, the defendant has refused to pay for the company’s losses.

According to the case, the plaintiff and proposed class members’ Westchester insurance policies were “all-risk” property damage policies in that they included coverage for all risks of loss except those specifically excluded in the paperwork. The lawsuit claims that because the plaintiff’s policy does not specifically exclude losses caused by viruses, the bar’s loss of business income, compliance with government orders to close, and expenses associated with protecting its property from further damage—losses sustained as a direct result of the ongoing coronavirus pandemic—should have been covered under the policy.

The case states that on March 15, 2020, the city of Boston and Massachusetts began issuing orders that restricted the plaintiff business’s ability to operate. On March 23, Massachusetts issued another order requiring the closure of all bars and nightclubs in the state.

The plaintiff claims that although it submitted a loss claim to Westchester, the company was informed by its insurance agent that the defendant would not pay for such losses.

The lawsuit out of Georgia comes amid a growing trend of cases filed against insurance companies over their allegedly improper denial of COVID-19-related claims.

ClassAction.org’s coverage of COVID-19 litigation can be found here and over on our Newswire.

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