Coronavirus Update: To New & Existing Clients Learn More ›

Super Lawyers
Illinois State Bar Association
Justia Lawyer Rating
Million Dollar Advocates Forum
Avvo Rating
BBB Accredited Business

Illinois Business Interruption Claims Attorneys

Many Illinois business owners have purchased business interruption insurance, thinking that it would be here to protect them when their business is ordered closed by an act of government in response to a pandemic.

However, many of these businesses have been stunned to learn that the business interruption insurance that they believed they paid for actually does not cover their claim related to the current COVID-19 crisis.

Business Interruption Coverage Lawsuits in Illinois

There has been a wave of lawsuits filed by business owners against insurance companies for denying business interruption claims. These court actions have been filed by a number of different businesses that have suffered direct physical loss from the government imposed shutdowns that have kept people inside.

One of the major issues is that the insurance companies have taken the position that some sort of physical damage is necessary in order to trigger a business interruption claim. This could be something that results from a natural disaster or an accident.

The companies argue that a government-ordered shutdown alone is not accompanied by the physical damage that is necessary to trigger the coverage as per the language of the agreement.

The Society Insurance Lawsuits

Society Insurance is one of the major business interruption insurers in Illinois. The company specializes in bars, restaurants, and other entertainment venues. These are precisely the types of businesses that have been affected by the COVID-19 crisis.

Numerous small businesses customers filed claims with Society Insurance thinking that their policies would cover the damage from the coronavirus shutdown. They were shocked and dismayed when they received a denial from Society related to their business interruption losses.

In the Society lawsuits, the two sides are as follows; the plaintiffs (business owners) say that the policy needed to specifically include pandemics in order for COVID-19 not to be covered while the insurer argues that business interruption must have a direct physical loss.

The plaintiffs claim that Society made a blanket decision to simply deny all COVID-19 related claims without any specific consideration of each case. Some business owners allege that Society issued denials of the claims on the same exact day that they were made, often within a few hours of their being filed.

Don't Believe What You Hear in the Media About Business Interruption Insurance Denials

There has been much press that has focused on the belief that insurance companies have a strong case in denying these claims. However, this is a case where you should not necessarily believe what you see on television and read on the internet.

The insurance companies have been active in trying to spread their opinion to make it less likely that they will face fewer lawsuits. However, their opinions do not change the clear language of your own policy.

What is Your Business Interruption Policy Language?

Ultimately, what this issue may come down to is the language of your specific policy. After all, when a court looks at an insurance agreement, it tries to give meaning to the language of the agreement. If there are words in the policy, the court will give them their plain and obvious meaning. If there is any ambiguity in your insurance policy, a court will interpret that language against the insurer.

Some insurance companies began to add a clause into policies after previous smaller scale viruses such as SARS. Many insurers specifically began to exclude viruses and bacterias from their business interruption insurance out of the fear that a pandemic could force them to pay out large numbers of claims.

The Insurance Company Will Find any way They can to Avoid Paying Legitimate Business Interruption Cases

Remember that insurance companies lose money when they pay claims. They will often try to find ways to exclude certain things that they know may cost them a lot of money because it will put a large dent in their profits, Thus if the insurers think that something can be a large risk for them, they will look to keep it out of their coverage.

Here, most insurers are hanging their hat on this exclusion as their reason to keep from paying the claims. Most insurance carriers have written some form of this into their contracts.

Even insurers who do not have this exclusion in their policies are arguing that there must be physical damage to the business in order to trigger their obligation to pay on the business interruption claims. In other words, an insurance company will try to find every trick in the book in order to not try to make your business whole.

Businesses who are filing these lawsuits are arguing that the actual damage to their business was not caused by the actual bacteria. Instead, their revenues dried up and their livelihoods went away because of the government closures and orders that resulted from the virus.

What You Need to do to File a Business Interruption Claim

If you have business interruption insurance, you should take several steps if you want to have a chance to recoup some money:

  • Review the language of your specific policy. Each policy may be written differently. Just because you are reading media reports about one policy containing certain terms does not mean that your policy is written the same exact way. Specifically, look at the covered cause of loss.
  • Make sure that you have a well supported and documented claim that meets the insurance company's requirements for a claim and can substantiate the amount of your direct physical loss.
  • Even if you think that the insurance company will reject the claim, you will still need to file it anyway to let them turn it down. Then, you will have the basis of a lawsuit.
  • Make sure that you hire an experienced insurance litigation attorney to fight for you in court. Insurance companies have armies of attorneys on their side with the sole aim of paying out as little as possible. As a small business owner, you need someone on your side who can fight for you.

This type of lawsuit would be slightly different than many court actions. Here, you are seeking the court to issue a declaratory judgment in your favor. What you are trying to get the court to do is tell the insurance company that the losses due to COVID-19 must be covered, This is basically the same thing as the court awarding you money because the insurance company would then need to pay your claim.

Illinois Business Interruption Insurance Cases

There is some precedent in Illinois that could support business in their efforts to have their claims paid. In one 1999 case, a court in Illinois held that asbestos contamination was the same as the physical damage that was necessary to trigger the business interruption coverage.

Here, COVID-19 may be considered property damage, and the business could receive coverage.

There may be some hope for Illinois businesses even if they do not end up with any relief through the courts. There are legislative moves underway in some states to force insurers to pay these types of claims.

For example, the legislatures in New Jersey, New York, Ohio, and Massachusetts are considering bills that would require insurance to pay business interruption claims. The payments would come from a fund that would consist of assessments on all insurers.

In the meantime, you should not let what you are hearing in the media keep you from filing your claim. If your claim is denied, you should try to file a lawsuit to compel the insurer to cover the claim.

You can count on hearing much more about the issue of business interruption and COVID-19 in the years to come. No matter what happens, there is likely to be years of litigation surrounding these claims since the insurance industry has taken the position that they do not have to pay.

Chicago Attorneys Reviewing Business Interruption Insurance Claims Across Illinois

Rosenfeld Injury Lawyers LLC is committed to assisting any business that has an unfairly denied business interruption case. Our lawyers have experience handling insurance litigation and stand ready to assist you. All of our cases are handled on a contingency fee basis meaning we only receive a legal fee when we are successful in obtaining a recovery for you. We are currently reviewing cases involving: restaurants, coffee shops, retail businesses as well as service-related business claims.

250M + Recovered for Our Clients
No Fee Guarantee We Never Charge a Fee Unless We Win
Available 24/7 Available 24-Hours per Day When You Need Us
Client Reviews
★★★★★
Jonathan Rosenfeld was professionally objective, timely, and knowledgeable. Also, his advice was extremely effective regarding my case. In addition, Jonathan was understanding and patient pertaining to any of my questions or concerns. I was very happy with the end result and I highly recommend Jonathan Rosenfeld. Michonne Proulx
★★★★★
Extremely impressed with this law firm. They took control of a bad motorcycle crash that left my uncle seriously injured. Without any guarantee of a financial recovery, they went out and hired accident investigators and engineers to help prove how the accident happened. I am grateful that they worked on a contingency fee basis as there was no way we could have paid for these services on our own. Ethan Armstrong
★★★★★
This lawyer really helped me get compensation for my motorcycle accident case. I know there is no way that I could have gotten anywhere near the amount that Mr. Rosenfeld was able to get to settle my case. Thank you. Daniel Kaim
★★★★★
Jonathan helped my family heal and get compensation after our child was suffered a life threatening injury at daycare. He was sympathetic and in constant contact with us letting us know all he knew every step of the way. We were so blessed to find Jonathan! Giulia
★★★★★
Jonathan did a great job helping my family navigate through a lengthy lawsuit involving my grandmother's death in a nursing home. Through every step of the case, Jonathan kept my family informed of the progression of the case. Although our case eventually settled at a mediation, I really was impressed at how well prepared Jonathan was to take the case to trial. Lisa