The Connection Between Physical Damage and Business Interruption Coverage[dagger]

Insureds facing loss from events such as natural disasters, civil disturbances or terrorism may seek coverage under business interruption insurance policies or under the "Civil Authority" provisions generally found in such policies. Those provisions typically cover losses resulting from pr...

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Bibliographic Details
Published in:FDCC quarterly 2004-07, Vol.54 (4), p.307
Main Authors: Downs, Andrew B, Bolduan, Linda M
Format: Article
Language:English
Subjects:
Business income
Business interruption insurance
Business operations
Damage claims
Denials
Hurricanes
Insurance coverage
Insurance policies
Language
Snow
Studies
Theater
Water mains
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Summary:Insureds facing loss from events such as natural disasters, civil disturbances or terrorism may seek coverage under business interruption insurance policies or under the "Civil Authority" provisions generally found in such policies. Those provisions typically cover losses resulting from prohibited access to covered property due to other property damage. Insureds, however, have become more assertive in presenting access claims arising out of events much more distant and remote than those traditionally envisioned in underwriting business interruption exposures. Given that trend, this article explores the connection required between covered physical damage and coverage for business interruption or denial of access caused by the action of civil authorities. As a general proposition, the "physical damage" requirement is still alive and well, though it may be tested in pending cases arising out of September 11, 2001 or recent natural disasters, such as the California fires.
ISSN:1544-9947