A Miami Beach beauty salon has filed a proposed class action against its insurers over their alleged denial of damage claims triggered by COVID-19-related business closures.
Filed against HDI Global Specialty SE, Axis Specialty Europe SE, and certain underwriters at Lloyd’s London, the lawsuit alleges the defendants have refused to pay for covered losses and expenses suffered by “at least thousands” of policyholders who purchased all-risk property insurance policies from the companies.
According to the case, the policy purchased by the salon included coverage for business income, extended business income, extra expense[s], and civil authority. Notably, the defendants chose not to include an endorsement that excluded coverage for “loss or damage caused by or resulting from any virus, bacterium or other microorganism that induces or is capable of inducing physical distress, illness or disease,” the lawsuit says.
The plaintiff argues that because its policy is all-risk and purports to cover any losses that are not specifically excluded, damages caused by the suspension of business operations amid the COVID-19 pandemic or related actions taken by civil authorities in response to the outbreak should be paid for by the defendants.
“These losses and expenses are not excluded from coverage under the Policy,” the complaint argues. “And because the Policy is an all-risk policy, and Plaintiff has complied with its contractual obligations, Plaintiff is entitled to payment for these losses and expenses.”
The suit states that in March 2020, the city of Miami Beach declared a state of emergency in response to the spread of COVID-19. Throughout March and April, the case explains, a series of emergency orders required all non-essential businesses in Miami Beach to remain closed, including the plaintiff salon. Miami-Dade County, the lawsuit notes, has been one of the most affected in the state of Florida, with over 10,000 reported cases of COVID-19 as of April 24.
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