A North Carolina court has that Cincinnati Insurance Co.must pay 16 restaurants’ claims for business income (interruption) losses due to government-ordered COVID-19 shutdowns – a decision that runs counter to those of most judges who’ve ruled on similar cases.As hundreds of COVID-19-related lawsuits regarding business interruption coverage make their way through U.S.

courts, judge after judge has in favor of insurer defendants.The central point has been that coverage depends – as specified in the insurance policies – on the policyholder suffering a “direct physical loss.” “Business income (interruption) policies generally reimburse a business owner for lost profits and continuing fixed expenses when its facilities are closed due to direct physical damage from a covered loss, such as a fire, a riot, or a windstorm,” said Triple-I CEO Sean Kevelighan.“Insurers have been prevailing nationwide in nearly all of the litigated COVID-19 BI lawsuits because, as North Carolina’s Insurance Commissioner has noted, ‘Standard business interruption policies are not designed to provide coverage for viruses, diseases, or pandemic-related losses because of the magnitude of the potential losses.’ ”  “Policy language controls whether COVID-19 interruptions are covered,” said Michael Menapace,  a professor of insurance law at Quinnipiac University School of Law and a .

“The threshold issue will be whether the insureds can prove their business losses are caused by ‘physical damage to property’.”   Cincinnati Insurance has said it plans to appeal the ruling.