The novel coronavirus (Covid-19) has and will continue to present novel issues in all facets or our lives. The insurance arena is no exception. Questions related to insurance claims, coverage, and defense have already begun to arise in the wake of Covid-19. As the quickly changing landscape continues to evolve, particularly with communities and businesses beginning to reopen, these insurance related queries and considerations will increase and grow more complex and nuanced.
Businesses need to be aware of potential claims. These could include allegations that a business negligently failed to protect or to warn third parties against the risks of infection; disclosed private information; or wrongfully quarantined an employee or tenant, thereby causing physical or personal injury, emotional distress, or loss of use of property.
Commercial General Liability (CGL) insurance policies are the standard and predominant policies for most businesses. Although policies vary and each potential claim has a unique set of facts, typically, these policies provide businesses with protection from third party claims related to bodily injury, property damage, personal and advertising injury, and for medical payments. The triggering event under the policy is an “occurrence,” usually understood as an accident or incident. Coverage under the policies requires the occurrence to have taken place during the applicable time period under which coverage was provided. “Bodily injury” is usually defined as “injury, sickness, or disease sustained by a person, including death.” Therefore, one might assume Covid-19 claims fall within most standard CGL policies – but, perhaps not.
CGL policies contain a variety of exclusions, excluding coverage under certain circumstances, which make the analysis more layered. For example, many CGL policies have mold exclusions and/or exclusions for exposure to bacteria. As a virus, and not a bacteria or fungus, Covid-19 does not truly fit into either of these two categories. Another common exclusion is for “pollutants.” “Pollutants” are commonly defined as contaminants or irritants. The exclusion is broader and there is a plausible argument that Covid-19 should fall under such an exclusion. However, short of specific language or exclusions, the answers will be determined by judicial interpretation and precedent. Where, as here, the issues are novel and of first impression, the precedent has yet to be written. The considerations, arguments, and, ultimate decisions will be shaped by those both with experience in the area and with the foresight, motivation, and flexibility to handle these issues as they arise and develop.
Ferguson, Schetelich & Ballew, P.A. handles insurance defense and coverage issues throughout the mid-Atlantic region. Since our founding in 1996, we have been trusted by insurers and insureds alike to handle insurance questions, claims, and litigation. If you have any questions related to Covid-19 and CGL insurance, or insurance issues more generally, please contact one of our attorneys in our Insurance Defense and Coverage Group.