All Things Legal
All Things Legal
This is a great place to start if you’re feeling overwhelmed or concerned about your legal rights during this unprecedented time, and we hope it will point you in the right direction if you or a loved one is suffering because of COVID-19.
In these uncertain times, we are still here to serve you! Like others, we are practicing social distancing, but that doesn’t mean you can’t connect with your attorney and case manager. Please call or email us any time, day or night. Remember, WE’RE IN THIS TOGETHER!
WE ARE HERE FOR YOU
Even though the COVID-19 virus is impacting nearly every aspect of our lives, be assured the John Fagan Law Firm is open for business for current clients and potential clients. We are accepting new cases and resolving pending cases during this emergency.
WE ARE ASSEMBLING CASES RIGHT NOW!
BUSINESS & EXTRA
YOU MAY BE DUE MONEY FROM YOUR BUSINESS’S
INSURANCE POLICY DUE TO FORCED COVID-19 CLOSURE
In Florida, a state heavily reliant on tourism, we have seen substantial hardship amongst hotels, restaurants, medical centers, and many other businesses. The commercial insurance policy you have been paying for may cover the financial shortfalls associated with COVID-19. To determine what coverage may be available to you and your business, it is imperative that you consult an attorney to thoroughly review your policy. Even if your policy contains an exclusion for pandemic related losses, we still want to review your business interruption policy or business loss policy. The case law relating to this area is evolving. Thus, there is a chance your policy may cover financial losses related to the Coronavirus.
Several states are pondering legislation to force insurance carriers cover COVID-19 business-related loss regardless of any exclusion stating otherwise. That’s why it is imperative you act now and get in line for the possibility that your claim may result in a settlement.
BUSINESS INCOME COVERAGE
Business Income Coverage often provides financial compensation for the actual loss of business income you sustain due to the necessary “suspension” of your “operations” during the “period of restoration.” The suspension must be caused by direct physical loss of or damage to property at your business’s premises. The loss or damage must be caused by or result from a Covered Cause of Loss.
It has been determined that a physical loss or damage is “any impact on property which prevents the property from being used for its intended purpose” which can include contamination of bacteria. For example, in Motorists Mutual Insurance Co. v. Hardinger, 131 F. App’x 823, 827 (3d Cir. 2015), when considering an infestation of a home with E coli bacteria, the court held that “a genuine issue of fact (exists) whether the functionality of the property was nearly eliminated or destroyed, or whether their property was made useless or uninhabitable.”
Additionally, in Cooper v. Travelers Indem. Co., No. C-01-2400, 2002 WL 32775680, at *5 (N.D. Cal. Nov. 4, 2002), the court found that the policyholder could make a claim for business income and extra expense loss due to a contamination of a well with E. coli bacteria.
Lawsuits are being filed to determine issues related to the causation element of Business Income coverage. Insurance carriers can be expected to deny such coverage as most businesses cannot prove the actual presence of the virus on the premises. However, it will be argued that the fear of the virus’ presence is enough to invoke such coverage.
Lastly, depending on the kind of insurance policy in place, your policy may include and incorporate a “policy exclusions” section which attempts to limit coverage under specific circumstances such as loss caused by: virus, bacteria, mold, microorganisms, contamination, pollution, etc. However, not ALL policies contain such exclusions and that such exclusions in your policy may not be fatal to your claim. Therefore, despite the existence of such an exclusion, you should always consult an attorney and request that they review your policy to determine whether you may be entitled to compensation for your loss.
EXTRA EXPENSES COVERAGE
Extra Expense Coverage allows for you to recover the necessary expenses you incur during the “period of restoration” that you would not have incurred if there had been no direct physical loss or damage to your property caused by or resulting from a Covered Cause of Loss. An insurance company will pay the extra expense to (1) avoid or minimize the “suspension” of business and to continue operations at the described premises or at replacement premises or temporary locations, including relocation expenses and costs to equip and operate the replacement location or temporary location, and (2) minimize the suspension of business if you cannot continue operations.
Losses that may be covered due to COVID-19 include:
1. Additional security to protect the business property during a time of social turpitude
2. Advertising costs to resume business
3. Disinfectant efforts to ensure the premises is safe
4. Relocation costs, potentially including those costs associated with equipping employees to work from home
Insurance companies will hotly contest these claims in litigation proceedings to come.
Triggering such coverage means their actual loss of Business Income incurred during the period when the property is repaired, rebuilt, or replaced and operations are resumed. Such coverage ends on the earlier of:
1. The date you could restore your operations, with reasonable speed, to the level which would generate the business income amount that would have existed if no direct physical loss or damage had occurred;
2. 60 consecutive days after the date determined above.
This coverage may run consecutively with the Civil Authority coverage mentioned above. This means that a court may determine you can collect Extended Business Income even after having collected losses under the Civil Authority portion of your policy. This will be litigated around the county as courts have drawn different conclusions about this issue.
In this COVID-19 pandemic, protecting workers is central to protecting public health. All workers on the job from health care workers, to emergency responders to those working in supermarkets, pharmacies and other essential work places must be protected. Workers must also be protected on a legal basis.
One question many people are asking is “Can my boss actually force me to work during the pandemic, and can he or she force me to come to work?” Experts say the answer is no, but the laws are not so clear-cut. Basically, federal guidelines allow state and local authorities to decide which businesses are essentially during a crisis. If you are not considered an “essential” worker, you are probably within legal rights to stay home and work from home (if possible). The Occupational Safety and Health Administration (OSHA) requires workplaces to offer environments that are “free from recognized hazards that are causing or likely to cause death or serious harm to employees.”
Below are some informative links from the Department of Labor:
BUSINESS INTERRUPTION AND INSURANCE COVERAGE
Businesses are feeling the impact of the COVID-19 virus and the hit it’s taking on their operations and revenues. Many businesses aren’t sure if their existing insurance policies will cover their losses. The scope and extent of available insurance coverage may depend on a number of factors, including the terms and conditions of the specific policies and the circumstances.
Below are some types of commercial insurance coverages that may respond to COVID-19 related claims and losses.
- Standard commercial property policies contain business interruption coverage (for losses sustained as a result of disruptions to the policyholder’s own operations) and contingent business interruption coverage (for losses sustained as a result of disruptions to the operations of a policyholder’s supplier).
- Available coverage may depend on whether there is “direct physical loss” to the policyholder’s (or supplier’s) property as a result of COVID-19.
Filing a claim for these losses typically involves establishing the amount of potential revenue your business has lost. Your insurance adjuster will valuate this loss by reviewing your company’s profit and loss statements, previous tax returns, non-continuing expenses, and projected sales.
Commercial Liability Insurance:
- These policies may provide coverage against third-party claims of customers/guests who contend they were infected due to the policyholder’s alleged failure to warn and protect them against the risk of exposure toCOVID-19.
- This coverage does have its limitations, especially in the case of commercial property. You must look at your core coverage. Furthermore, your business interruption coverage may impose time limitations and exceptions you will need to explore.
Below are links to some additional COVID-19 resources:
Civil Authority Action:
You may also be covered for losses suffered as a result of “Civil Authority”. Civil Authority Coverage applies when there is an order or action issued or taken as a result of (a) physical loss or damage or (b) perils insured against to property adjacent to the insured premises or within a certain distance thereof, which prevents, prohibits, or impairs access to the insured premises.
When a covered cause of loss causes damage to property other than property at the described premises, the insurance company will pay for the actual loss of Business Income you sustain and the necessary extra expenses caused by action of civil authority that prohibits access to the described premises provided that 1) access to the area immediately surrounding the damaged property is prohibited by civil authority as a result of the damage, and the described premises are within that area but are not more than one mile from the damaged property and 2) the action of civil authority is taken in response to dangerous physical conditions resulting from the damage or continuation of the Covered Cause of Loss that caused the damage, or the action is taken to enable a civil authority to have unimpeded access to the damaged property.
Courts have interpreted the civil authority provision as not requiring physical damage to property in order to trigger coverage. Such coverage may instead be triggered when such an order or action, such as a “stay at home” or “safer at home” or a curfew, causes a business interruption, which in turn, resulted in financial loss.
When deciding whether Civil Authority is triggered, it is imperative to look to your state and local orders which should state the purpose for the order, such as Broward County [FL] Administrator’s Emergency Order 20-01, enacted on March 22, 2020, which states that the “emergency order is necessary because of the propensity of the virus to spread person to person and also because the virus is physically causing property damage due to its proclivity to attach to surfaces for prolonged periods of time.”
The governor of Florida also issued at statewide “stay at home” order that went into effect April 3.
Civil authority coverage for business income will begin 72 hours after the time of the first action of civil authority that prohibits access to the described premises and will apply for a period of up to four consecutive weeks from the date on which such coverage began.
Civil Authority Coverage for Extra Expense will begin immediately after the time of the first action of civil authority that prohibits access to the described premises and will end upon the later of:
- 4 consecutive weeks after the date of that action, or
- When your civil authority coverage for business income ends