By Jensen, Randy on October 1, 2020.
Calgary-based Guardian Law Group is launching a class-action lawsuit on behalf of business owners who have been denied insurance coverage for losses sustained due to COVID-19 under the “all risks” policy from Lloyd’s Underwriters.
Guardian Law Group is also open to potentially launching other class actions against other insurers besides Lloyd’s Underwriters if there are business owners who have been denied coverage for COVID-19 losses under similar “all risks” policies.
“This one is against Lloyd’s, but we suspect as things go ahead there will be people who contact us who had similar experiences with other insurance companies,” confirms Guardian Law Group attorney Mathew Farrell. “In this case, one person who is in Calgary has stood up and said, ‘This is not fair. I paid my insurance premiums. Something bad happened, and that is what insurance is supposed to cover, but they are not. And that’s not right.'”
The way a class action works is usually there is one or a few named complainants which stand in for all classes of the same type out there. If successful, any claim received from the lawsuit is paid out equally to everyone in the same circumstance as the named complainant.
“This particular client is a landlord,” explains Farrell, “and in this case it had to do with business interruption associated with his rental properties. But it is the same policy whether we are talking about rental properties or other businesses. I think for most people this particularly speaks to interruptions in business (due to COVID-19).”
Farrell says similar class actions have been launched already across North America, but have yet to be tested in court.
“Where the rubber meets the road here,” Farrell states, “and where the battle lines are going to be drawn, is the policy says that it covers anything bad that happens to you that causes a loss with respect to property. It is talking about physical property. If there is damage to physical property, then there is a loss.
“Here, the argument is that COVID-19 is a physical thing that happens in the world that affects you physically, and affects the usability and safety of your property physically just like damage from a fire would affect the feasibility of your property É Here, just because the thing that is dangerous is too small to see doesn’t make it any less physical, and doesn’t mean the policy should be any less engaged.”
Farrell says any business in the Lethbridge area covered by Lloyd’s Underwriters “all risks” policy, or those who may be interested in pursuing similar class-action lawsuits against other insurance providers, should visit the Guardian Law Group website and register their names with the firm.
“The insurance policy says all risks, and that should mean all risks,” Farrell concludes. “The point is it should cover the things we didn’t foresee, and this is a great example of something we didn’t foresee. That doesn’t mean the insurance company is supposed to get out of it. That means the insurance company is supposed to help you, because that’s why you paid your premiums.”
The Guardian Law Group website address is http://www.guardian.law.
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