Written by Gary Reinhardt, Esq. As we enter the “endemic” phase of COVID-19, many things changed in our society. For instance, after a couple of years of being isolated, it seems people want to gather more. Further, with the multi-year moratorium on indoor weddings caused by the pandemic, the rush to book those venues created a logjam for the foreseeable future, pushing back planned matrimonial bliss. These situations result in even more living together arrangements. As for insurance, how does this situation impact who qualifies as an “insured” in a homeowners’ or tenant policy and along with that, who has coverage? For example, consider an insured with a live-in girlfriend. Suppose she is not on a lease or deed (and moved in after application, to avoid the easy argument of rate evasion). An insured may attempt coverage for his girlfriend in two aspects, either by claiming she is “family” or a “family member” or invoking the “personal property of others” clause. Initially, the typical policy requires for coverage that “The personal property must be owned or used by you, or your family members who reside with you . . .” What happens when a person, not the named insured (“you”), suffers a loss of his/her exclusive property like clothes or some sort of family heirloom? Many property insurance policies do not define “family member.” However, auto policies, like the standard specimen policy posted to its website by the Virginia Bureau of Insurance, does: “Family member” means a person related to you by blood, marriage or adoption who is a resident of your household. This includes a ward or foster child. Likewise,...
Written by Stephanie G. Cook, Esq. Edited by Bill Pfund, Esq. Between March 16, 2020 and July 8, 2020, the Supreme Court issued several “emergency orders” in response to the COVID-19 pandemic, which tolled all statute of limitations. Since then, there has been considerable debate as to when the tolling period created by these emergency orders runs. In fact, the courts in Virginia have essentially been split on the issue. See Tinsley v. Clarke, 2022 U.S. Dist. Lexis 56625 (W.D. Va. March 28, 2022) and Proctor v. AECOM, Inc., 2021 U.S. Dist. Lexis 162142 (E.D. Va. August 26, 2021); see also English v. Quinn, 2022 Va. Cir. Lexis 7 (Roanoke City Cir. Court Feb. 7, 2022); but then see Ceriani v. Dionsysus, Inc., 2022 U.S. Dist. Lexis 73499 (E.D. Va. April 20, 2022); Heck v. Guion, 108 Va. Cir. 179 (City of Chesapeake Cir. Court June 4, 2021) and Brown v. State Farm, 107 Va. Cir. 343 (Culpeper County Cir. Court March 11, 2021). In general, plaintiffs have taken the position that the emergency orders tolled and extended all statutes of limitations. Thus, plaintiffs argued they had an additional 126 days (the time between March 16, 2020 and July 8, 2020) to file their Complaint in a personal injury action. For example, in Virginia, the statute of limitations for a personal injury suit is 2 years. Assume the date of an automobile accident was November 19, 2019. Generally, the time for plaintiff to file his or her suit in such a case would have run by November 19, 2021. However, due to these emergency orders, a plaintiff would likely...
Written by Gary Reinhardt, Esq. The Bureau of Insurance strongly encourages insurers and other licensees to be flexible and take into consideration the hardships and constraints many individuals and businesses are experiencing during this unprecedented public health emergency. For this reason, the Bureau encourages those it regulates to consider taking the following actions, consistent with prudent insurance practices: Insurers should consider relaxing due dates for premium payments, extending grace periods, waiving late fees and penalties, and allowing payment plans for premium payments to otherwise avoid a lapse in coverage. Insurers should also consider cancellation or non-renewal of policies only after exhausting all other reasonable efforts to work with policyholders to continue coverage. (Bureau of Insurance bulletin, March 27, 2020) The Bureau of Insurance (BOI) is not mandating that insurers provide flexibility with this statement, merely that insurers “should consider” not canceling policies if insureds have COVID-19 related issues that hamper premium payments. However, some insureds are taking advantage of the extensions of insurers and using this to shop rates or just take a break from premium payments. If insureds do not renew a policy, an insurer does not have to jump through all of the cancellation hoops contained in title 38.2 of the Code of Virginia. If an insured does not respond to an offer to renew, the policy lapses and the insured has no coverage as of the timeframe contained in the policy. Almost if not every insurer initially conditions renewal on receipt of premium when the insurer makes its first offer of renewal. This condition on receipt overrides any claims that simply mailing the premium prior to...
Written by Janeen Koch, Esq. & Gary Reinhardt, Esq. As the country reels from the devastating impacts caused by COVID-19, commercial property insurance carriers are being inundated with claims – primarily those for business interruption losses. These claims are, for the most part, being denied. Many commercial insurance policies, including those that include business interruption coverage, do not include coverage for viruses such as COVID-19. After the SARS outbreak in 2003, Mandarin Oriental International Ltd. received $16 million from a settlement with its insurers to pay for business interruption losses due to the outbreak. Insurance carriers responded by adding endorsements to their policies excluding coverage 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.” Based upon this exclusionary language, business interruption losses due to COVID-19 would almost certainly be excluded under the clear and unambiguous language of the policy. However, for those policies that do not contain such an exclusion, it is less clear whether business interruption claims would be excluded from coverage. To obtain coverage under a commercial property policy, the insured must demonstrate “direct physical damage” to the property caused by a covered loss. Typically, such losses covered under these policies include damage caused by fire or natural disasters such as earthquakes or hurricanes. In some instances, coverage may be afforded when the property is not accessible or habitable due to damage to properties in the surrounding area. For example, coverage has been provided for businesses that must close due to a chemical spill at a neighboring property. Although...
Written by Claire Carr, Esq. Edited by Rachel Riordan, Esq. Workers compensation’ claims based on COVID-19 are on the rise. Adjusters and employers are starting to receive questions about these clams and the circumstances under which they may be compensable. This article examines COVID-19 claims as an occupational disease under the Virginia Workers’ Compensation Act and how we anticipate these claims being handled by the Virginia Workers’ Compensation Commission. When dealing with diseases, the Virginia Workers’ Compensation Act differentiates between an “Occupational Disease” and an “ordinary disease of life.” Virginia’s Occupational Disease statute, Va. Code §65.2-400(A), defines an occupational disease as “a disease arising out of and in the course of employment, but not an ordinary disease of life to which the general public is exposed outside of the employment” (emphasis added). Under Va. Code § 65.2-400(B), to meet this burden, the employee must prove (1) a direct causal connection between the work conditions and the occupational disease; (2) that the disease can be seen to have followed as a natural incident of the work as a result of the exposure due to the nature of the employment; (3) that the disease was proximately caused by the employment; (4) that it was not a disease to which he would have had substantial exposure outside of employment; (5) it was incidental to the character of the business, and not independent of the employee/ employer relationship; and (6) the disease originated in a risk of employment and flowed as a direct consequence of it. The elements above are typically proven with competent medical evidence. The most obvious types of occupational disease...
Written & Edited by Janeen Koch, Esq., Kevin Kennedy, Esq. & Matt Daly, Esq. As businesses around the world suffer dramatic declines in revenue due to the pandemic, they are turning to their insurance carriers seeking coverage for business interruption losses. However, many of these claims are being denied based upon the fact that they are either not covered or specifically excluded under the terms of the insurance policy. The requirement that insureds demonstrate “direct physical damage,” coupled with the fact that many policies include a virus and bacteria exclusion, will make it difficult for business owners to obtain coverage for these losses. Consequently, legislators in many states are proposing laws to require insurance companies to retroactively provide coverage for business interruption claims even when the policies specifically exclude such coverage. New Jersey became the first state to initiate the trend of looking to rewrite business interruption coverage for COVID-19 into these policies with proposed bill A-3844. That bill would require business interruption claims to be honored by insurance carriers for any business with fewer than 100 full-time employees that had a business interruption policy as of March 9, 2020. It appears that New Jersey’s bill has stalled for now, but other states have brought forward similar proposals, including New York, Massachusetts, Pennsylvania, Michigan, and South Carolina, as well as the District of Columbia. The Federal government has also drafted legislation aimed at protecting small businesses from losses sustained as a result of virus-related closures. H.R. 6494 – Business Interruption Insurance Coverage Act of 2020 – was introduced on April 14, 2020. The bill, which has bipartisan support, would...