Lawsuits demanding insurance companies cover COVID-19-related business losses are under review in numerous Federal courts across the country, including one filed on behalf of Augusta University Health.
U.S. District Court for the South District of Georgia has granted a request to delay until the end of the month the requirement AU (and its Rhode Island-based Affiliated FM Insurance Company) share evidence each side plans to present during hearings.
MORE: AU Health Files $9 Million Lawsuit: Sues AFM Insurance for COVID-19 Related Businesses Losses
The AU lawsuit, filed in February 2021, accuses AFM of acting in bad faith and breach of contract and demands $9 million dollars.
AFM filed its response in early March and cited a clause excluding coverage due to contamination from, “the actual or suspected presence of any foreign substance.”
The list of exclusions includes virus among the hazards.
However, AU court documents state that AFM filed with the Georgia Department of Insurance two “Healthcare Endorsement” updates. One in 2015 said, “For the purpose of this coverage, the presence and spread of communicable disease will be considered direct physical damage and the expenses listed above will be considered expenses to repair such damage.” In the second, filed in 2016, AFM expanded this coverage again, adding it to the Core All-Risk Policy, which AU says it has.
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Similar lawsuits were filed last year by several law firms on behalf of more than 20 Minor League Baseball teams, including the Augusta GreenJackets.
The teams suffered financial losses when the league decided to suspend the 2020 season because of COVID-19 concerns.
MORE: FEMA to Assist with Funeral Costs Brought by COVID-19
Those lawsuits were dismissed in September 2020 because the contracts each team had with its individual insurance provider included an exclusion clause: “We will not pay for loss or damage caused by or resulting from any virus, bacterium or other microorganism that induces or is capable of inducing physical distress, illness or disease.”
Appeals have been filed with the U.S. Court of Appeals Ninth Circuit. A hearing could be scheduled in San Francisco, Calif. in early August.
Dana Lynn McIntyre is a Staff Reporter with The Augusta Press. You can reach her at dana@theaugustapress.com.
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