Hampshire Home, the corporate that owns Cheers and different Boston-area eating places, is suing numerous insurance coverage suppliers over denied claims filed in response to the COVID-19 shutdown.
Hampshire Home, the proprietor of a slew of Boston eating places, together with Cheers, filed a lawsuit in opposition to a handful of its insurance coverage suppliers over “denied business interruption claims it filed in response to the coronavirus pandemic shutdowns as the company navigates estimated losses of millions of dollars.” The swimsuit was filed earlier this week in opposition to Fireman’s Fund Insurance coverage and Related Indemnity Company, and their guardian business, Allianz International Dangers United States Insurance coverage Firm. The choice to file the swimsuit got here after the insurance coverage firms “refused to pay the claims on its ‘Property-Gard’ policy.”
According to the lawsuit, the insurance coverage suppliers “breached their contract in denying the claims and didn’t act in good religion.” Consequently, Hampshire Home is in search of unspecified damages. Along with owning each Cheers, the company additionally owns Hampshire Home, 75 Chestnut, 75 on Liberty Wharf, and a Boston-area distribution heart. In the mean time, Hampshire Home employs about 290 workers. Nevertheless, earlier this yr, each restaurant below the company’s umbrella was pressured to shutter its doorways when the COVID-19 pandemic took over.
According to the suit, the Hampshire Home “carries over $10 million in enterprise interruption insurance coverage and already estimates losses valued at a number of million money.” Moreover, all through the pandemic, the corporate has “continued to pay six-figure insurance premiums.” The swimsuit additional noted that Cheers additionally depends on tourism to assist hold it in enterprise. The swimsuit states:
“Hampshire (like others who buy enterprise interruption insurance coverage) has faithfully paid its premiums. But, when Hampshire made a declare due to a catastrophic enterprise interruption attributable to state and native emergency orders, the defendants summarily and arbitrarily denied Hampshire’s claims. Hampshire (like many companies) has relied on its enterprise interruption insurance coverage to cowl what it’s imagined to cowl – substitute of enterprise earnings and fee of ongoing bills in an effort to rebuild its companies.”
The corporate additional argued that the insurance coverage suppliers didn’t make a “good religion investigation, decide protection and modify Hampshire’s claims as a result of defendants reached a pre-determined conclusion to disclaim protection.” Moreover, attorneys representing the corporate pointed to a submit revealed on Allianz’s web site about COVID-19-related claims dealing with. Particularly, the submit reads:
“Usually, any normal property and enterprise interruption protection have to be triggered by physical loss or harm to property at an insured location and infectious illness is normally not a coated peril.”
The swimsuit argues the observe has resulted within the “improper denial of not countable enterprise interruption claims, together with these from Hampshire Home.” When commenting on the case, Tucker Merrigan, one of many attorneys representing Hampshire Home, said “insurers can not deny a declare based mostly on contradictory and ambiguous language.” He added:
“Insurance coverage carriers promote contracts they write for cash. These contracts are a whole bunch of pages lengthy. The courts have lengthy held that if there may be ambiguity or tried catch-all language to cowl their backside line, such language doesn’t apply.”
Peter Merrigan, one other legal professional representing the corporate, chimed in and said:
“Whereas the insurance coverage trade might cry afoul about their backside line, too many small enterprise homeowners, restaurant homeowners, fitness center homeowners, resort homeowners, and medical suppliers are staring chapter within the face. It is a survival second and all choices have to be on the desk.”