After all “nonessential” businesses in New York were ordered to close, art groups (i.e. movie theatres, concert halls, etc.) knew they were facing financial trouble. With ticket sales and other streams of revenue becoming non-existent, many art groups decided to dip into their business interruption policies for financial relief as their operations had, in fact, been disrupted. While most assumed their insurers would pay their claims seeing that they had been making their payments on time, several art groups were told that their coverage wouldn’t protect them against the COVID-19 pandemic.

 

The Dance Theater of Harlem Denied Business Interruption Insurance Coverage for Losses Associated with the COVID-19 Shutdown

 

The Dance Theatre of Harlem’s executive director Anna Glass said that when the art group submitted their payments to their insurer, “[they] believed [they] were being protected.” But after the COVID-19 virus hit New York State hard, the company learned that their insurer wasn’t prepared to cover their claims. Glass told the New York Times that “it was disheartening to realize we weren’t [protected].” The news source said that the art group quickly filed their claim “arguing that New York’s shutdown of “nonessential” businesses had halted the company’s revenue stream. “There could be no after-school ballet classes, no cross-country tour for its dance company, and certainly no 50th-anniversary gala with tickets starting at $1,500.”

The Dance Theatre of Harlem wasn’t the only art group in New York to file a business interruption claim. In fact, a small venue in Brooklyn called Jack also filed a claim with its insurance company to cover losses associated with the COVID-19 shutdown. The news source says that within days or weeks after receiving claims, both companies were denied coverage. Although each business had the proper coverage to pay for a civil authority shutdown, their insurer refused to cover their claims.

 

Insurers Argue Business Interruption Only Covers for “Direct Physical Loss or Damage”

 

Art groups in New York aren’t the only companies who have had their business interruption insurance claims denied. The truth is, most businesses who have submitted claims for COVID-19 losses haven’t been provided with coverage. According to the insurance industry, “its policies never promised this kind of coverage in the first place and that fulfilling all of these requests would bankrupt the industry.”

While some companies have decided to respond to their denial notices by filing suit against their insurers, others are waiting to see if their state is going to impose a bill that would require insurers to pay up.

If your insurance company denied your business interruption claim, there are New York insurance claim denial lawyers who can help you understand what your legal rights are. USAttorneys.com can help you locate an insurance claims denial attorney in NY now if you are seeking legal advice.

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