COVID Decision Of Interest

In a recent New York Court of Appeals opinion, the court found that business losses due to the COVID-19 pandemic were not covered under an "all-risk" commercial property insurance policy. In Consolidated Rest. Operations, Inc. v Westport Insurance Corp.¹, plaintiff Consolidated Restaurant Operations (CRO) sought a declaration that their insurance provider, Westport Insurance Corporation (Westport), had obligations under CRO's insurance policy to compensate CRO for losses sustained at CRO's properties due to the COVID-19 pandemic. The court held for the defendant, finding that the effects of the coronavirus did not constitute "direct physical loss or damage" to the properties, and dismissing the breach of contract and declaratory judgment claims.