We wanted to make sure you saw the recent court ruling by Michigan’s 30th Circuit Court that sided in favor of insurers and rejected restaurants’ business interruption claims, as covered in the Insurance Journal. 

With Judge Joyce Draganchuk stating that the virus did not cause physical damage to the plaintiffs’ property, this ruling is a definitive outcome in that insurers are not liable for financial damages caused by virus closure orders. This marks the second ruling in as many months to chart the historic legal precedent set years prior, along with several other instances of cases already being withdrawn. The judge’s interpretation is consistent with the approach of other states and should play a pivotal role in shaping future decisions. 

A few key highlights from the case are below: 

• “Draganchuk rejected the central argument made by plaintiff’s attorney Matthew Heos: that the government order that restricted business to dine-in only amounts to a physical loss because the order effectively blocks public entry to the property. ‘That argument is simply nonsense,’ [Judge Draganchuk] said.”
  

• “‘There has to be something that physically alters the integrity of the property,’ she said. ‘There has to be some tangible, i.e. physical, damage to the property.'”
  

• “Draganchuk recited one of [the insurance industry’s] main points during her oral ruling — that the virus harms people, not property.”
  

For more information and resources, go to fairinsure.org.