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New Hampshire Court finds hotel business persistently covered COVID-19 BI loss



On Tuesday, a court in New Hampshire issued a summary judgment to the owner of many hotels after discovering that the hotels they maintained covered "physical loss of or damage to" insured property caused by COVID-19 and its viral pandemic. agent, SARS-CoV-2. The merit decision is yet another victory for policyholders who continue to take the step towards an early wave of dismissals of insurance companies, most of whom, unlike the decision on Tuesday, never considered evidence in support of their decisions.

Schleicher & Stebbins Hotels, LLC v. Starr Surplus Lines Ins. Cos. No. 217-2020-CV-00309 (NH Super. Ct. Merrimack Cty. 1

5 June 2021), the court granted the policyholder's summary assessment proposal to all but one insurance company and found that the presence of COVID-19 caused physical loss of or damage to property, as evidenced by countless state closure orders and restrictions. Central to the court's decision was its ruling that the phrase 'physical loss or damage' does not require (as insurers routinely claim) structural changes. Rely on Mellin v Northern Security Insurance Co. 115 A.3d 799 (NH 2015) ("physical loss" in an insurance contract includes "not only concrete changes to [an] insured property but also changes … which exist in the absence of structural damage," provided that such changes are both "clear and demonstrable") the court found that "the presence of SARS-CoV-2 is detectable, was found by various government agencies to be widespread in the regions where hotels were located and has been" consistent [ly] "determined to" survive [e] … on certain surfaces "of the kind found within and around hotels. "

In addition to deciding for the policyholder in the core issues of" physical loss "and" damage ", the court ruled in favor of an insurance company, Axis, and found that the insurer's exclusion of pollutants excludes coverage because SARS-CoV-2 is a virus "Spread" By people with COVID-19. However, the court rejected the other insurers' attempts to apply the exclusion of micro-organisms from their policies for a similar purpose. The court justified that there are competing views on whether a virus, such as SARS-CoV-2 , is a "micro-organism" and that, since an exemption from coverage must be interpreted narrowly and against the insurer, competing views meant that "a virus is not unambiguously understood as a & # 39; micro-organism & # 39 ;." As such, the exclusion could not apply. .

Policyholders continue to make progress in educating courts about the true nature of COVID-19 and how it physically changes property. As more courts actually consider evidence and accusations, policyholders can expect the volume of favorable decisions to increase.


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