Insurance Upset COVID-19 Forces a New Look at Policies ©iStockphoto.com/NancyEdmonds
By Phillip M. Perry
Businesses face many questions about insurance coverage for the costly damages incurred by the COVID-19 pandemic. What unexpected exclusions are only now becoming apparent? What litigation should be expected? And how can businesses retool their policies to reflect the increased risk in the months and years ahead?
48 / SPRINGS / Fall 2020
T
he risk of legal action is very real. “There will no doubt be more lawsuits alleging liability against businesses where customers, vendors or employees contract COVID-19,” says C. Thomas Kruse, partner and chair of the Litigation Practice Group for Texas in the Houston office of Baker McKenzie. These risks are expected to remain high as the effects of the pandemic continue to be felt. In this article, attorneys and insurance consultants address the most important concerns in the areas of commercial general liability (CGL), workers’ compensation, and employment practices liability insurance (EPLI). A sidebar covers business interruption insurance.
CGL Insurance A business may be sued by customers, vendors or visitors who contract COVID19 while visiting a facility. “The next step in lawsuits will likely be third parties on the premises who contract COVID-19, especially if the business has not followed all guidelines for protecting against the disease from the Centers for Disease Control and Prevention (CDC) or state and local authorities,” says Kruse. Such guidelines can include the availability of masks, maintaining social distancing, and provision of hand sanitizer and related gear. “Indeed, such lawsuits are already starting to pop up around the country.”
