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  #61  
Old 03-31-2020, 09:15 AM
JMBNYC JMBNYC is offline
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Originally Posted by sticks1839 View Post
Anyone following the Keller (of French Laundry) restaurant lawsuit against Hartford Fire over this?



The article is quoted from the plaintiff side, but it sounds like his coverage included "prohibition due to order of civil authority". That would seem pretty cut and dried to me. Am I missing something?

Typical BI language needs property damage from the covered peril. So the existence of Coronavirus in the general area of the restaurant would need to be deemed "damage." Pretty questionable, but definitely a better case than the policies that just straight up exclude it that state governments are trying to rewrite.
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  #62  
Old 03-31-2020, 09:19 AM
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If states do make insurers pay, will reinsurers then pay insurers? I can see a situation where reinsurers go unscathed even though insurers have to pay and bought reinsurance for cat risk and such.
I think this is a case where reinsurers are stuck with whatever happens to insurers. If insurance policies aren't allowed to exclude virus, why would reinsurance policies be allowed to exclude virus?
Maybe it would get covered @ 90% under ECO/XPL.
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Old 03-31-2020, 09:19 AM
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A lot of policies straight up exclude viruses. And states are trying to rewrite the policies.

I don't know about you guys, but the BI premium that I have seen is really incidental and not really meant to cover events like this (hence the exclusion). What I have seen is mostly package business where property is included.
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  #64  
Old 03-31-2020, 09:21 AM
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I think this is a case where reinsurers are stuck with whatever happens to insurers. If insurance policies aren't allowed to exclude virus, why would reinsurance policies be allowed to exclude virus?
Maybe it would get covered @ 90% under ECO/XPL.
But who is going to force the reinsurer to pay for something they didn't intend to cover either.

The states can force the insurers. Can the insurers force the reinsurers?
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  #65  
Old 03-31-2020, 09:24 AM
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But who is going to force the reinsurer to pay for something they didn't intend to cover either.

The states can force the insurers. Can the insurers force the reinsurers?
Well I don't think any of this survives a court challenge so
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  #66  
Old 03-31-2020, 09:34 AM
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The CAS just published a paper that discusses potential LOB impacts including WC, Property, Event Cancellation, Cyber, etc.

I can't find the link for it though.
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  #67  
Old 03-31-2020, 09:34 AM
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Reinsurers will definitely follow the fortunes of their cedents.

Clarification: nat cat reinsurance is a different animal, both in terms of perils covered and event duration

Last edited by Arthur Itas; 03-31-2020 at 10:08 AM..
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  #68  
Old 03-31-2020, 11:26 AM
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curious: what kind of E&O risks do agents/brokers have in this: e.g. the "you should have told me pandemics weren't covered" types of disputes.
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I'd say relatively low risk, as it's not like agents had a widely offered pandemic product to sell to insureds.
maybe i'm overthinking it, but what about the dispute "you told me it covered all perils"?
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  #69  
Old 03-31-2020, 12:03 PM
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maybe i'm overthinking it, but what about the dispute "you told me it covered all perils"?
Still think that's a stretch to professional E&O cover. What could/should the agent have done differently to help cover the insured? Arroway gave one credible scenario earlier: if a lower rated carrier goes under due to the current crisis, there could be some E&O claims for failure to advise going with a higher rated carrier. That's also pretty low on the risk scale but possible.

IANAL, and I'm sure arguments will be made in many lines to find coverage.
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Old 03-31-2020, 02:28 PM
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maybe i'm overthinking it, but what about the dispute "you told me it covered all perils"?
I think the bigger risk would be if an agent said it would cover a pandemic situation.
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