Restaurants, bars, salons, and day care centers are pushing back against their insurance companies refusing to cover business interruption claims related to government-mandated shutdowns due to the coronavirus pandemic. Now a sports facility in Pennsylvania has joined the fight, the Pennsylvania Record reports.

The Chester County Sports Arena of Dowington filed a lawsuit in the U.S. District Court for the Eastern District of Pennsylvania against its insurer, Cincinnati Specialty Underwriters Insurance Company of Fairfield, Ohio. The sports arena, which laid off about 30 workers due to the shutdown, claims in its lawsuit that it “faithfully paid premiums” to the insurance company “specifically to provide, among other things, additional coverages in the event of business interruption or closures by order of civil authority. Under the policy, insurance is extended to apply to the actual loss of business income sustained and the actual, necessary and reasonable extra expenses incurred.”

On March 19, Pennsylvania Gov. Tom Wolf ordered all non-life-sustaining businesses in the state to cease operations and close all physical locations. The Chester County Sports Arena followed suit and was soon forced to lay off more than two dozen part-time and full-time employees. The arena continues to lose business income and incur other expenses as the shutdown continues.

Business interruption insurance is part of a business owner’s insurance policy. It provides coverage of payroll, bills, and other operating expenses in the event a business is forced to close due to a disaster. Insurance companies describe such disasters as fires or hurricanes, but now say pandemics are not covered.

Some policies have virus exclusions. But many do not. Thus, businesses suffering under state-ordered shutdowns are reaching out to their insurers for a lifeline only to get rejected.

The Chester County Sports Arena is represented by Richard M. Golomb of Golomb & Hoink in Philadelphia, and Daniel “Dee” Miles of Beasley Allen Crow Methvin Portis & Miles PC., in Montgomery, Alabama.

Business seeking to sue their insurers for business interruption coverage should first file a claim with their insurance company to preserve any legal claims moving forward. Attorneys with Beasley Allen Law Firm 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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