On Friday, January 15, 2021 at 6:38:52 AM UTC-8, AMuzi wrote:
Leaving aside my reservations on the newish UK 'supreme
court' scheme, this raises some very large questions:

https://cyclingindustry.news/supreme...-interruption/

Hoping for comment from Mr Beattie, and all of you who have
thoughts to offer.

In my understanding, a business flooded which did not
purchase flood insurance is just out. Which is as it should
be IMHO. The damage looks to me from regulatory action, not
the chinese weapon itself. I can't see how a contract[1]
could have an exclusion removed ex post facto. But I'm open
to other ideas.

[1] We do not of course know the language of every pertinent
contract in the class.

BTW, in the US, the score is probably 80/20 for insurers on BI coverage for COVID shut-downs -- and higher for insurers who issued policies with virus exclusions. I'm representing insurers in a couple of class actions and have been keeping score. I'm waiting for an opinion out of the Oregon USDC.

The ISO standard BI endorsement was intended to provide coverage for lost cash flow when your business burns down or when it is shut down by government authority because your neighbor's business burned down (e.g. closed business with crime tape). It is not free-floating coverage for business interruption due to any cause, although you can buy those policies.

Different states interpret insurance policies differently. There are also state statutes that may affect the interpretation of insurance policies. The most pro-consumer approach is the so-called "reasonable expectations" doctrine for interpreting policies -- hmmm, what would a reasonable consumer believe the policy covers? Answer: everything. Oregon has a very rational approach that is probably the national standard: give effect to the plain language of the policy. If a term is undefined, give it its ordinary meaning (typically dictionary definition). If the term is still ambiguous, look to the broader context of the policy to see if the ambiguity can be resolved. If not, construe it in favor of coverage. It's still consumer protection, but at least it is more closely tied to the actual language of the policy.

Speaking of rewriting polies, there are a butt-load of state COVID orders affecting the renewal and cancellation of policies, and there was talk of a national statute -- in a nation with the McCarran Ferguson Act -- basically mandating COVID BI coverage post hoc (with no corresponding premium payment), but that went nowhere. It's just like no-eviction orders, which are rewriting private lease agreements. The loss is always being shifted up. That can only go so far when it comes to adjusting private contracts -- but its amazing how far it can go, even under the Contracts Clause. https://constitution.congress.gov/br...artI_S10_C1_5/

Insurance companies went through this before with the SARS epidemic, and the Insurance Services Office (ISO) (private company that writes policies and provides premium rating data) came up with the virus exclusion. https://tinyurl.com/y49mzosr Your policy probably has one of these. Most of my insurance clients use these, but not all, including the client in the class action.

I have no idea what the standard policies look like in the UK (and I'm not going to learn unless someone pays me). All I see are Lloyds and London Market excess policies (and reinsurance contracts), and they're arcane and sometimes less than a page (following form to the primary) -- and provide a zillion in excess coverage. I know some UK coverage law, but its all in the maritime field, and I don't know what rules they apply to standard property policies and BI endorsements. My guess is the UK Supreme Court applied some version of the "reasonable expectations" doctrine to a poorly worded policy and created coverage. The policies probably don't have virus exclusions. It's hard to know, but you can find coverage through creative interpretation.

-- Jay Beattie.