QBE in legal fight on pandemic insurance
QBE Insurance has been named in another legal case over business-interruption insurance concerning the coronavirus pandemic, this time in the US.
American discount retailer Century 21 is taking legal action against insurers after last month filing for bankruptcy.
Amid the economic fallout from the pandemic, the retailer entered so-called chapter 11 bankruptcy after 60 years of continuous trading.
Co-chief executive Raymond Gindi said the decision followed the refusal of the company’s various insurers, including QBE’S American arm, QBE Specialty Insurance, to pay $US175M ($244m) due under Century 21’s business-interruption insurance policies.
The case has echoes of a British test case, in which QBE was also named, where it was determined insurers were liable for pandemic-related claims made against business-interruption insurance.
A test case is also under way in New South Wales, but is unlikely to be as clear cut as business interruption policies in Australia often exclude pandemic diseases from coverage.
Century 21’s suit has been rebutted by QBE and the other defending insurers, who say their business-interruption policies do not cover the economic impacts of the pandemic.
In particular, QBE sought to classify the virus under the “microorganism exclusion endorsement” clause.
Other defendants to the suit include Allianz Global, Liberty Mutual Fire Insurance and Landmark American Insurance.