Two Native American tribes in Oklahoma have filed separate lawsuits against multiple insurance companies seeking declaratory judgments that their business interruption insurance policies cover the losses they are incurring during the coronavirus pandemic.

The Chickasaw and Choctaw nations have not been denied coverage, but business interruption claims have already been denied in Louisiana and other places.

The Chickasaw, Choctaw and other Oklahoma tribes have temporarily shut down their casinos to help spread the slow of COVID-19, resulting in mounting financial losses. The pandemic has also dealt a blow to their hotels, travel plazas, and other businesses.

Insurance companies that have denied similar claims have argued that business interruption coverage doesn’t apply to losses caused by coronavirus shutdowns because there is no physical damage to property.

A lawyer for the Oklahoma tribes refutes that assertion, arguing that properties have been damaged by the virus and the pandemic because they can’t be used for their intended purpose, according to The Oklahoman.

The tribal businesses are also covered under policy provisions that compensate for interruptions by civil authority, according to the tribes’ lawyers. They point out that emergency directives by the U.S. Centers for Disease Control and Prevention (CDC) and other government agencies have made the casinos impossible to use.

“As a result of this pandemic and infection, the Nation’s property sustained direct physical loss or damage and will continue to sustain direct physical loss or damage covered by the policies, including but not limited to business interruption, extra expense, interruption by civil authority, limitations on ingress and egress, and expenses to reduce loss,” the lawsuits state, according to The Oklahoman.

The Chickasaw and Choctaw nations obtained and pay for multiple insurance policies that provide “all risk” benefits, the lawsuits contend. The benefits include coverage for “business interruption, interruption by civil authority, limitations of ingress and egress, extra expense,” and more.

It isn’t uncommon for insurance companies to seek court declarations that losses aren’t covered in the wake of major disasters, lawyers familiar with the lawsuits say. Lawsuits seeking a judicial declaration that certain losses are covered may help pre-empt costly denial-of-overage legal battles.

We are actively pursuing these cases already with our clients who received a denial communication from their insurance companies. Dee Miles, Head of our Consumer Fraud Section, Rachel Boyd and Paul Evans are spearheading this litigation for our firm. They would like to talk to you about any potential claims.

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