April 16, 2020

Dental Practice Files Complaint Against Insurer After Denial of Business Interruption Claim

Sandy Point Dental PC (Sandy Point), a dental practice near Chicago, filed a lawsuit against its insurance company for denying its business interruption claim for losses incurred after the governor closed all nonessential businesses in mid-March. The governor’s order deemed routine and non-emergency medical services as not essential, resulting in a suspension of over 95% of Sandy Point's services. Immediately after closing, Sandy Point sought coverage for its business losses from its insurance provider. The provider denied the claim, reasoning the policy only covered losses that resulted from direct physical damage to the property. Sandy Point argued that because COVID-19 can live on surfaces, it constitutes a physical threat, and is therefore equivalent to physical damage. Sandy Point alleges that the refusal was an "arbitrary and unreasonable" breach of contract and is seeking a declaratory judgement.