Insurance Policy Governed By Ohio Law Providing Coverage For A “Direct Loss” To Certain Property Does Not Cover COVID Shut Downs

Richard C.O. Rezie By Richard C.O. Rezie, Joseph W. Pappalardo

The Court, in a 6-1 decision, found that the temporary presence of COVID-19 in a community or at a business and the temporary presence of an infected person don’t amount to a “direct physical loss” that might be covered according to the common all-risk policy language.

The insurer argued that the coronavirus, like the flu, hurts people but doesn’t alter buildings. Thus the “physical loss” standard was not met.

A brief dissent argued that existing Ohio contract law is clear and that the Court should not have taken in the case, upon a request from a Federal Court seeking guidance.

Read the full opinion by clicking here.

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