As retailers were forced to close their doors in the Spring, many filed business interruption claims with their insurers.

Not surprisingly, many of these claims ended up in court after insurers rejected them. Michael Miguel, principal at McKool Smith, says the insurance industry got in front of COVID claims early and has made well-coordinated arguments around the country in the COVID litigation. Still, he is seeing mixed results so far.

"At the early stage of litigation, courts have been asked by insurers to dismiss all claims because there is no possibility of coverage under the policies," Miguel says. "Several—but not all—jurisdictions have agreed with the insurance industry and denied the COVID-related insurance claims. Miguel says one reason for these denials is that the nature of losses sustained by policyholders resulting from COVID does not neatly fit into traditional notions of "damage." Initially, specific exclusions would appear to preclude coverage. For example, a landlord might have property coverage that also provides for business interruption losses.