D.C. Court Finds in Favor of Insurer in Business Interruption and COVID-19 Case

The Superior Court of D.C. sided with an insurance company, finding that a typical property insurance policy does not provide business interruption coverage for losses resulting from the COVID-19 pandemic and resulting public shutdowns. The case is Rose’s 1, LLC, et al. v. Erie Insurance Exchange, No. 2020 CA 002424 B, D.C. Super.

Erie issued a commercial property policy to Rose’s 1, LLC, (Rose’s), owners and operators of several prominent D.C. restaurants. Each restaurant was insured by “Ultrapack Plus Commercial Property Coverage” from Erie Insurance Exchange. The policies included coverage for “loss of ‘income’ and/or ‘rental income’” sustained “due to partial” or total “interruption of business” resulting directly from “loss or damage” to the insured property. The policies further state that the “policy insures against direct physical ‘loss’” with the exception of several exclusions that do not apply in this case.