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ARTICLE · 28 JULY 2020

Update: California Legislation To Include "Rebuttable Presumptions" Supporting COVID-19 Business Interruption Coverage

Wilson Elser Moskowitz Edelman & Dicker LLP
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On June 29, 2020, the California Legislature amended California Assembly Bill 1552 (AB 1552) to address purported insurance recovery for COVID-19 losses.

United StatesInsurance
Paul S. White
Paul S. White
Siobhán A. Breen
Siobhán A. Breen
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On June 29, 2020, the California Legislature amended California Assembly Bill 1552 (AB 1552) to address purported insurance recovery for COVID-19 losses. Pursuant to the language of AB 1552, the bill was designed to "protect the solvency of businesses that were forced to close their doors or limit business" due to the COVID-19 pandemic.

As amended, AB 1552 would create three rebuttable presumptions affecting the burden of proof in a case in which the insured alleges that its business was interrupted due to the COVID-19 pandemic:

  • First, with respect to coverage for general business interruption and extra expenses, AB 1552 would create a rebuttable presumption that "COVID-19 was present on the insured's property and caused physical damage to that property, which was the direct cause of the business interruption."

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