Insurance Policy Types

Following the Illinois Supreme Court’s 2021 ruling in West Bend Mutual Insurance Co. v. Krishna Schaumburg Tan, Inc., 2021 IL 125978, which we covered in detail, a Chicago-based federal court recently handed another insurance coverage victory to businesses facing class actions under the Illinois Biometric Information Privacy Act (BIPA). The U.S. District Court for the Northern District of Illinois found that a general liability (GL) insurer had to defend its policyholders against two class action lawsuits alleging that the policyholders were selling biometric data in violation of BIPA and common law rights.
Continue Reading Illinois Court Builds on 2021 State Supreme Court Ruling to Find Further General Liability Insurance Coverage for Biometric Information Privacy Act (BIPA) Class Actions

Businesses operating in Illinois have faced thousands of lawsuits arising under the Illinois Biometric Information Privacy Act (BIPA), leading to hundreds of cases and related insurance claims. Insurance companies have aggressively denied coverage for these claims and filed litigation seeking court approval of their denials, forcing policyholders into a two-front legal war. Recently, the Illinois Supreme Court granted a major victory for businesses facing BIPA lawsuits, holding that a BIPA lawsuit alleging a wrongful sharing of biometric information fell within standard “personal or advertising injury” coverage in a commercial general liability policy and was not excluded.
Continue Reading Illinois Supreme Court Affirms BIPA Lawsuits Are Covered by GL Policies

As previously reported in this blog, the U.K. Financial Conduct Authority (FCA) brought a case against a variety of insurers under 21 policy wordings seeking clarification of sample clauses because the carriers refused to pay any U.K. claims relating to COVID-19 business interruptions largely for hospitality businesses. The policyholders seem to have won most of the coverage issues, and indeed the carriers have announced that they would book significant losses.

The basic issues involved the coverage for a series of extensions (specified loss clauses) to basic Business Interruption (BI) coverage, which covered the closure of a business due to an order of a competent governmental authority based on the existence of a notifiable disease in the vicinity of the covered business. These extensions have relatively low limits under $50,000. Given these low limits, it was financially impracticable for individual policyholders in the United Kingdom to separately litigate their claims against their insurers. As such, the insurers appeared to be denying claims on the assumption that most policyholders would not be in a financial position to press their claims. The recent decision in the case brought by the FCA will now allow tens of thousands of U.K. small-business policyholders an affordable path to coverage.

Continue Reading FCA Case Provides a Win for Policyholders and Vindicates the Concept of Expedited Generalized Rulings for Small Businesses

Since the beginning of the COVID-19 pandemic, hundreds of businesses of all sizes have been forced to file lawsuits against their property insurers for failing to honor their contractual obligations to provide business interruption, extra expense, civil authority, and other coverage for the substantial losses caused by the COVID-19 pandemic. Unfortunately, this onslaught of litigation

Due to the COVID-19 pandemic, institutions of higher education are facing significant revenue challenges and incurring extra expenses for which their insurance programs should provide relief. Potentially covered sources of loss and damage include (1) efforts to make buildings safe for students, faculty, staff, and administrators, (2) tuition adjustments, loss of athletic and extra-curricular events revenue and related sponsorships, and (3) extra expenses and/or lost revenue related to student housing issues.

Continue Reading Higher Education COVID-19 Losses: Property and Business Interruption Insurance Policies Should Provide Relief

The insurance industry in the United States continues to thwart legislative solutions for disputed COVID-19-related losses under property/business interruption policies and resists efforts to group lawsuits together into multi-district federal litigation or class actions. Meanwhile, the independent regulator of insurers in the United Kingdom, the Financial Conduct Authority (FCA), is trying to take a more

In the latest episode of the podcast series Insurance Considerations Amid COVID-19, we are joined by Deborah White, president of the Retail Litigation Center (RLC) and senior executive vice president and general counsel of the Retail Industry Leaders Association (RILA). Deborah provides insight and analysis regarding the retail industry’s varied and innovative response to the pandemic, including how large retailers deal with the patchwork of evolving state and local regulations and how they are innovating at breakneck speed to meet consumer demand while maintaining safety for employees, suppliers, and customers. Not surprisingly, we also talk about masks, how we all got our start in retail, and a little … insurance.

Continue Reading Podcast Series: Key Insurance Considerations Amid COVID-19

General liability coverage is insurance that responds to sums that the policyholder is legally obligated to pay as damages because of bodily injury or property damage to third parties (and generally will also include either a duty to defend such claims or to reimburse defense costs). Thus, general liability coverage would respond to such tort claims as slip-and-fall lawsuits and product liability exposures. In addition, most such policies also cover certain enumerated personal or advertising injury offenses (such as defamation or disparagement).

Most general liability policies are written on an “occurrence” basis. An occurrence-based general liability policy is triggered to respond by bodily injury or property damage taking place during its policy period, regardless of when the claim is made against a policyholder. Given multi-year statutes of limitations for many torts and the possibility of latent injuries, this means that it is frequently a prior year’s occurrence policy (or policies, for long-term injury claims) that responds to a claim that comes in during the current year.

Continue Reading Key Issues to Consider When Contemplating a Switch From an Occurrence-Based to a Claims-Made General Liability Insurance Program

As the COVID-19 pandemic spreads across the globe, countries have by and large placed limitations on how certain businesses can operate and have required other businesses to temporarily cease operations altogether. Businesses impacted by these restrictions have suffered substantial financial losses and, unsurprisingly, are looking to their business interruption insurers to cover these losses. As businesses begin to make business interruption claims, a stark contrast is arising between how U.S. and European insurers and governments are handling the influx of such claims related to COVID-19.

Continue Reading United States vs. Europe: How Insurers Have Responded to Business Interruption Claims Related to COVID-19

What is Business Interruption Coverage?

Business Interruption Coverage is a type of insurance coverage that compensates you for lost revenue when your business is unable to operate for a period as result of some physical property loss or damage caused by a covered peril. The most common example is a fire that damages a business property. If that damage prevents a business from operating as usual, business interruption coverage could provide the revenue your company would have made during the time it was unable to operate because the building was being restored. While a fire could certainly damage a tech company’s property, a tech company might be more vulnerable than other companies to certain types of damage, such as a weather-related event that knocks out the temperature controls in a data center, thereby resulting in the loss of, or damage to, electronic data. While nearly all companies in this day and age store data electronically, a data center can be more of the heart and soul of tech company than other types of companies.
Continue Reading Fundamentals of Business Interruption Coverage—What Tech Startups Might Need to Know