SDV Insights

The cancellation of events producing income, galas and other fundraising events, the furloughing and quarantining of employees and volunteers, and the prospect of possible third-party liability claims have all caused considerable financial strains for many nonprofit entities, in recent weeks, thanks to the COVID-19 crisis. Insurance coverage can help nonprofits weather the storm but getting past initial insurer denials or reservations of rights can require both know-how and considerable work.

In a victory for policyholders, the California Supreme Court recently held that an insured faced with a progressive loss only needs to exhaust all directly underlying polices to access excess layers within that policy period.

Construction projects are susceptible to injuries and property damage - which is why the stakeholders involved rely heavily on commercial general liability ("CGL") insurance policies when such losses occur.

On April 22, 2020, in a 4-3 opinion, the Pennsylvania Supreme Court ruled that an insurer must defend its insured in connection with an intentional murder-suicide that also resulted in unintentional injuries.

As the nation responded to the COVID-19 pandemic, bars and restaurants across the nation were shut down by local or state edict with no known re-opening date in sight. Beware of the (no) vacancy provision! Almost every commercial property policy has some variation of a vacancy or unoccupancy provision.

Published in the Spring 2020 issue of NASBP Surety Bond Quarterly. Richard W. Brown, Michael V. Pepe and Janie Reilly Eddy were recently featured in the National Association of Surety Bond Producers magazine, with their article New Additional Insured Endorsement Forms Will Impact Contractors, Project Owners, Lessees.

Most franchise systems are facing severe financial impacts as a result of the continued spread of COVID-19 and the numerous government-mandated shutdowns that have been ordered by state and local officials in response. Even if your franchised operations are considered essential and able to remain open during the shut-down, franchisees may have exposures, in addition to a loss of revenue, which may further impact franchisors.

COVID-19 has impacted businesses large and small across the country. Some companies predict that their services or products will be in higher demand, and anticipate marked financial success in the coming months, while others brace for collapse. Either scenario creates a potential liability: the risk of misrepresentation or improper disclosure to investors about the company's outlook, financial health, capabilities, or any information that influences investor decisions.

On March 30, 2020, the Ontario Superior Court of Justice released its opinion in the MDS, Inc. et al v. Factory Mutual Insurance Company case. While the case is favorable to policyholders with business interruption claims under "all risk" policies, attorneys representing policyholders are particularly excited as Justice Wilson's adoption of broad interpretation of "resulting physical damage" may be very useful in pursuing coverage for business interruption losses related to COVID-19 exposures.

Several businesses have commenced litigation in Florida against first-party commercial property insurers seeking coverage for business interruption losses resulting from state and local government orders enacted to mitigate the spread of COVID-19.