Legislative, Regulatory and Litigation

Find stories on Lawsuits and Litigation including Business Interruption and Auto rate issues. You’ll also find, executive orders, workers’ compensation, federal, and state matters impacting the insurance industry here.

LAWSUITS AND LITIGATION

BUSINESS INTERRUPTION


SEPTEMBER 15
UK policyholders hail victory in battle over COVID-19 insurance claims

London judges have ruled that some of the world’s biggest insurers were wrong to reject tens of thousands of claims from small firms battered by the COVID-19 pandemic. Read more here.

SEPTEMBER 14
Insurer Says Rejection Of COVID-19 Loss Suits Growing Daily

Aspen American Insurance Co. has told a Texas federal court that it should follow the “daily-growing” number of courts rejecting businesses’ claims seeking COVID-19 closure coverage, since its policyholder, a Minnesota dental office, failed to show physical damage from its claimed revenue loss. Read more here.

Insurer wins COVID-19 dispute with barbershops
A federal court ruled a pair of San Diego barbershops can’t recover income lost due to coronavirus-related shutdowns from their insurer. Read more here.

SF Retailer Can’t Get COVID-19 Income Loss Coverage
A California federal judge on Monday found that Travelers Casualty Insurance Co. of America doesn’t need to cover a San Francisco retailer’s business losses resulting from COVID-19 shutdowns, saying the retailer hasn’t alleged it has suffered physical damage to or loss of its property. Read more here.

SEPTEMBER 8
Michigan Suit Brings Another Loss for Plaintiffs with COVID-19 Business Interruption Claims
The ruling by the U.S. District Court for the Eastern District of Michigan continues a losing streak for attorneys who argued that government agency closure orders to prevent the spread of COVID-19 should trigger coverage for lost business income. Read more here.

SEPTEMBER 3
Virus exclusion holds up in COVID-19 coverage case
A federal court ruled the virus exclusion in a dentist’s commercial insurance policy with a unit of Nationwide Mutual Insurance Co. bars coverage for coronavirus-related losses. Read more here.

SEPTEMBER 1
Case count tops 1,000 as litigation against insurers over COVID-19 takes shape
A federal judge’s ruling in Missouri represents one of the first victories of note for policyholders as litigation over business interruption insurance continues to pile up across the U.S. But with only a handful of opinions issued on the matter so far, it is clear that legal battles over whether pandemic-related losses are covered are still in the very early days of winding their ways through court. Read more here.

AUGUST 31
Insurer Defeats California Restaurant’s Coronavirus Business Loss Claim
A federal court in California has dismissed a lawsuit filed by a Los Angeles restaurant seeking business interruption losses from Travelers Indemnity due to coronavirus-related restrictions on its business. Read more here.

AUGUST 26
3 Reasons COVID-19 Business Income Suits Should Not be Combined

Recently a U.S. Judicial Panel on multidistrict litigation denied a proposal to consolidate cases related to business income losses related to coronavirus. Read more here.

AUGUST 17
‘It’s a huge decision’: Judge hands a win to businesses demanding insurance coverage for lost income due to coronavirus

A group of Kansas and Missouri hair salon and restaurant owners can proceed with a lawsuit trying to make their insurance company pay for the income they missed out on during COVID-19 government shutdown orders, a judge ruled Wednesday. Read more here.

School reopenings expected to bring a wave of lawsuits
A Georgia high school that made headlines for its packed hallways and unmasked students announced Aug. 9 that it would close for at least two days after it identified nine cases of COVID-19. Read more here.

AUGUST 13
Federal judge tosses San Antonio barbershops’ lawsuit against State Farm over COVID-19 losses
A federal judge Thursday tossed a case brought by six San Antonio barbershops against State Farm Lloyds for losses sustained after they were forced to shut down to prevent the spread of the coronavirus. Read more here.

AUGUST 11
Courts rule insurers not responsible for COVID-19 BI losses
American multinational investment bank, Morgan Stanley (MS), has commented on a decision made by the Superior Court of D.C. which finds that the COVID-19 pandemic does not cause direct physical damage which would be a required trigger for business interruption (BI). Read more here.

COVID-19 Lawsuits: An Unprecedented Rise in Legal Warfare
There have been a lot of changes in the world due to the pandemic, but the rise in lawsuits and claims was not something any of us expected. Read more here.

As Business Interruption Lawsuits Pile Up, Several Lawyers Question the Strategy
Lawsuits over denial of coverage for business interruptions due to COVID-19 are piling up in New Jersey courts, but some experts expect the plaintiffs will have a difficult time recovering. Read more here.

AUGUST 07
D.C. Judge Rules For Insurer, Dismisses Restaurants’ Business Interruption Claims
The insurance industry has notched another victory in its defense of its commercial insurance policies against claims for business interruption due to the coronavirus. Read more here.

AUGUST 04
Coronavirus Lawsuits: 50 New York Restaurants Demand Insurance Companies Cover Damages
More than four dozen New York restaurants are suing their insurance companies, attempting to gain relief from coronavirus damages. The suit alleges the restaurants suffered physical losses because they had to partially reconstruct their properties to comply with pandemic guidelines. Read more here.

JULY 30
SF’s Historic Cliff House Restaurant Sues Insurance Company Over ‘Dishonest and Egregious’ Claim Denial
San Francisco’s historic Cliff House restaurant made headlines last week when it announced that after hustling to serve takeout and delivery meals during the pandemic, financial pressures had forced its temporary closure. Now its operators are suing their insurance company after it denied its business interruption claim. Read more here.

JULY 29
COVID BI Coverage Suits Top 700; Yep, That’s A Lot
When insurance coverage lawsuits brought by businesses seeking coverage for COVID-related interruptions surpassed the 700 mark last week, the natural question to ask was: Is that a lot? Read more here.

Hotel’s COVID-19 lawsuit hinges on policy renewal language
A recent class-action lawsuit filed by the owner of The Crescent Plaza Hotel against Zurich American Insurance Co. in the Northern District of Illinois illustrates the reappearance of one of the arguments litigated numerous times. Read more here.

Cheers owner sues insurers over refusal to cover coronavirus-related losses
Hampshire House Corp., which owns both the original and Faneuil Hall Cheers bars and the 75 on Liberty waterfront bar, this week sued three insurance companies to recoup the losses its incurred since the city and state shut down bars in March due to Covid-19 reasons. Read more here.

JULY 28
Berkshire Hathaway files motion to dismiss virus-related lawsuit
Other insurance companies may follow in Berkshire Hathaway’s footsteps in the near future. As the COVID-19 pandemic rages on, insurers continue to be the target of business interruption lawsuits. Read more here. (must register to read)

JULY 27
Hitting the books: Two MO universities file class action against insurer over pandemic losses
Two universities based in the state of Missouri have filed a class action lawsuit against their shared insurer, arguing that the insurance company denied their business interruption claims for losses sustained during the COVID-19 pandemic. Read more here.

JULY 23
Bill Would Force Insurance Co. to Pay Coronavirus ‘Business Interruption’ Claims
California Assembly members James Ramos (D-San Francisco) and Monique Limón (D-Santa Barbara) are pushing legislation that would force insurance companies to pay coronavirus-related “business interruption”claims they have been denying. Read more here.

JULY 21
Altar’d State slaps insurer with $28 million lawsuit
A national women’s fashion boutique is suing its insurer for $28 million over wrongful denial of coverage, alleging that the insurer denied the retailer’s business interruption claim for pandemic-related losses just days after it was filed. Read more here.

Denny’s Children’s Wear, Ta-boo restaurant sue insurers for denying claims
Both Palm Beach County businesses allege breach of contract by their insurance companies. Retailers and restaurants are losing money hand over fist during the pandemic, but insurance companies are still refusing to pay business interruption insurance claims, according to a series of recently filed lawsuits. Read more here.

JULY 20
Billionaire wades in with lawsuit over business interruption claims
The number of lawsuits filed against insurers over denied business interruption (BI) claims continues to rise, as a real estate tycoon becomes the latest plaintiff attempting to claim on pandemic-related business losses. Read more here.

JULY 14

It’s a COVID-19 Pandemic; It’s Everywhere – New Cal. Bill to Make Insurers Prove Otherwise
On June 29, in a development that may fundamentally change the landscape for California businesses which have sustained COVID-19 related business interruption loss, two California legislators amended pending legislation to address several of the most hotly contested issues regarding insurance recovery for these devastating losses. Read more here.

JULY 13

P/C Insurance Survey: 55% Back Worker Presumption; 54% See Interrupt Cases Failing
A slight majority (54%) of property /casualty insurance industry professionals think insurers will succeed in defeating legal and political attempts to force them to pay business interruption claims from the coronavirus pandemic. Read more here.

Legislation to Force Insurers to Pay COVID-19 Claims Stalls as Virus Rages
California legislation that would have forced insurers to pay more coronavirus business-interruption claims was put on hold last week when state lawmakers decided not to return from their summer recess because of a resurgence of the disease. Read more here.

JULY 07
Federal Biz Interruption Bill Backed by Plaintiffs Group Introduced
Last week, a U.S. lawmaker introduced a bill that would allow insurers to voluntarily pay certain COVID-related business interruption claims and get reimbursed by the federal government, but insurance groups have rejected the idea. Read more here.

If we force insurers to pay COVID-19 BI claims, it “would totally bankrupt” most of them
As insurance regulators brace for an onslaught of business interruptions claims resulting from the coronavirus pandemic, one state commissioner admits forcing insurers to pay for these claims will only hurt the industry. Read more here.

Circus Circus sues insurance company, claims it failed to honor contract with COVID-19 losses
Lawyers for Circus Circus filed a federal lawsuit against its insurance company this month after a COVID-19-related claim was denied. The suit was filed July 2 in federal court by Circus Circus, LV, LP against AIG Specialty Insurance Company. Read more here.

Michigan Judge Rejects Restaurants’ COVID-19 Business Interruption Claim
A trial court judge in Lansing, Michigan handed a victory to insurers in what may be the nation’s first final ruling on the question of whether a property insurer is liable for financial damages caused by a coronavirus closure order. Read more here.

JULY 02
Reopening the restaurant sector – a legal perspective
As the COVID-19 lockdowns lift, many restaurants and hospitality businesses are struggling to resume operations due to limited capacity, restrictions from health authorities, and low customer traffic caused by eroded consumer trust. Read more here.


AUTO

LAWSUITS

AUGUST 04
Customers sue Allstate and other large auto insurers for bigger rebates
The lawsuits allege that large car insurance companies didn’t provide enough financial relief as Illinois motorists stayed off the road during the height of the pandemic. Read more here.


IMPACT

AUGUST 10
Usage-based insurance gaining steam among consumers
63% of U.S. consumers are open to changing their current auto insurance policy for one that has a telematics-based premium. Read more here.

JULY 16
Miles driven set to drop with increased work-from-home
Working from home and online shopping have become the new normal and that will reduce driving in the U.S. by up to 270 billion miles a year, according to new study. Read more here.

JULY 06
Progressive reveals profits in face of pandemic refunds
Despite reporting a significant drop in claims and providing auto insurance customers with premium refunds, Progressive generated a substantial profit during the pandemic – a detail that consumer advocates believe is unfair to customers. Read more here.


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TEXAS AND LOCAL UPDATES

JULY 15
Houston Rockets Sue Insurer Over Denied Covid-19 Loss Claims
The Houston Rockets and billionaire owner Tilman Fertitta are suing their insurer for denying the National Basketball Association team’s bid to tap its business-interruption insurance policy over revenue losses from the Covid-19 pandemic. Read more here.

JULY 14
Texas hospitals are running out of drugs, beds, ventilators and even staff
Many Texas hospitals are no longer accepting transfer patients in order to maintain space for a surge that’s expected to come. In some parts of the state, it’s already here. Read more here.

Houston Leaders Urge Citywide Lockdown Amid Virus Case Surge
Top officials in Houston are calling for the city to lock back down as area hospitals strain to accommodate the onslaught of patients sick with the new coronavirus. Read more here.

JULY 09
Is the coronavirus pandemic putting Texas businesses at a higher risk of lawsuits?

As COVID-19 cases rise, the legal aspect is one of many in which businesses are navigating between staying afloat and keeping people safe. Some are pushing for a legal shield granting businesses immunity — but others are pushing back, worried that the current legal environment does not protect workers enough. Read more here.


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TEXAS DEPARTMENT OF INSURANCE

ICT Summaries of TDI COVID-19 Related Actions
TDI and has been issuing bulletins and emergency rules to keep up with the changing needs and issues brought on by the COVID-19 pandemic. Since these are coming in at a rapid pace, ICT has compiled summaries of each agency’s actions up to July 29 for reference.
Read the TDI summary here.

JUNE 30
Texas Insurance Department Asked to Conduct Auto Insurance Data Call
The Texas Office of Public Insurance Counsel (OPIC) has asked the Texas Department of Insurance (TDI) to conduct a special data call of the top 10 auto insurance groups in the state to gather information about personal auto claims during the COVID-19 pandemic. Read more here.

JUNE 26
OPIC requests auto insurance data call
The Office of Public Insurance Counsel (OPIC) sent a letter to Commissioner Sullivan requesting that TDI conduct a special data call of the top 10 auto insurance groups in the state to gather information about personal auto claims during the COVID-19 pandemic. Read the letter here.

JUNE 24
TDI extends telemedicine emergency rule into September

The Texas Department of Insurance (TDI) is extending a requirement that insurers cover telemedicine services, including mental health visits, at the same rate as in-person visits. Read more here.

JUNE 16
Texas Returning to Normal Temporary Agent License Process on Aug. 15

Anyone with a temporary license issued August 15 or earlier will have until Nov. 13 to get a regular license. Read more here.

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DWC AND WORKERS’ COMPENSATION NEWS


ICT Summaries DWC COVID-19 Related Actions
DWC has been issuing bulletins and emergency rules to keep up with the changing needs and issues brought on by the COVID-19 pandemic. Since these are coming in at a rapid pace, ICT has compiled summaries of each agency’s actions up to August 10 for reference. 
Read the DWC summary here.

AUGUST 14
These Workers’ Comp Experts Agree: The Industry Must Prepare for Huge Change After the Pandemic

Workers’ comp has changed a lot over the past few years. If claims management companies want to succeed they will have to look at both the industry’s past and future. Read more here.

AUGUST 04
TDI adopts NCCI rules related to COVID-19
TDI adopted National Council on Compensation Insurance (NCCI) Item B-1441—Revisions to NCCI Manual Rules Related to the COVID-19 Pandemic. The filing revises and establishes rules related to paid furloughed employees and reporting final premium for employers affected by the pandemic. The changes in Item B-1441 apply to new, renewal, and outstanding policies effective on and after March 1, 2020.

JULY 29
Washington Extends Relief for Employers Struggling to Pay Workers’ Comp

The Washington State Department of Labor & Industries is again extending the deadline for employers that are finding it difficult to pay their workers’ compensation premiums during the COVID-19 outbreak. Read more here.

JULY 09
NCCI Proposes Rule for Experience Rating Related to COVID-19 Claims
The National Council on Compensation Insurance (NCCI) filed Item E-1407—Exclusion of COVID-19 Claims from Experience Rating and Merit Rating. The filing proposes that the changes in Item E-1407 apply to experience rating modifications with rating effective dates of August 16, 2020, and later.

JUNE 12
Early trends in COVID-19 claims

As COVID-19 continues to affect the entire insurance market, an early look at claims trends offers a good place to start when it comes to understanding the full impact of the pandemic. Read more here.

JUNE 09
Facing Workers Compensation Challenges During the Pandemic: NCCI

The COVID-19 pandemic has upended lives, families, business routines, and the economy. Read more here.

JUNE 04
Bills would provide rebuttable presumption for workers with COVID
Kansas lawmakers introduced three bills Wednesday that would extend coverage to workers who acquire coronavirus on the job. Read more here.

COVID 19 Regulatory & Legislative Update: WC Compensability Presumptions
The COVID-19 crisis has impacted many state legislative sessions with state legislatures adjourning early, postponing their sessions, or focusing primarily on COVID-19 and state budget-related matters. NCCI is tracking COVID-19 related legislation around the country and at the federal level. Read more here.

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FEDERAL

AUGUST 5
Texas AG Urges Congress to pass Safe to Work Act
Texas Attorney General Ken Paxton joined 21 other states in a letter to the United States Congress urging the adoption of federal pandemic liability protections contained in the Safe to Work Act. These protections will help mitigate the threat of frivolous COVID-19-related litigation against first responders, healthcare workers, law enforcement, and healthcare facilities, among other entities, while ensuring victims have legal options where appropriate. Read more here.

JULY 30
Coalition Letter on Coronavirus Liability Protections

The undersigned organizations urge you to support the timely, targeted, and temporary liability relief provisions contained in S. 4317, the “SAFE TO WORK Act.” These crucial protections would safeguard healthcare workers, providers, and facilities, as well as businesses, non-profit organizations, and educational institutions against unfair lawsuits so they can continue to contribute to a safe and effective economic recovery from the COVID-19 pandemic. Read more here.

JULY 21
What Could Stall Another Stimulus Check? Offering Protection From Coronavirus Lawsuits
Although Republicans are warming to the idea of authorizing a second round of individual checks, a partisan impasse over a seemingly obscure issue—limited liability—could delay any federal relief from getting approved anytime soon. Read more here.

JULY 20
Taking Insurers to Court Won’t Help Business. Government Must Step In
The late, great Kenny Rogers had some pretty good advice that plaintiffs’ attorneys could heed today about knowing when to hold’em and when to fold’em. As a lawyer and former insurance commissioner and Senator, it is clear to me what our businesses don’t need right now: expensive, lengthy litigation. Read more here.

JULY 07
COVID workplace suits increase: Report

The two types of COVID-19 claims that have been filed most frequently are employment discrimination claims and work-from-home/leave claims. Read more here.

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