United States: No Direct Physical Damage To Property – Benny's Famous Pizza Plus v. Security National

Presence of COVID-19 held not to constitute requisite physical damage in coverage dispute

Benny's Famous Pizza Plus Inc. v. Security National Insurance Company, 2021 NY Slip Op. 31963(U), 2021 WL 2772403 (Sup. Ct. Kings Cnty. July 2, 2021)

This case involved a business interruption claim for losses arising out of COVID-19 closures.

By decision dated July 2, 2021, Judge Lillian Wan dismissed the complaint against the insurance company, holding that the policy did not provide coverage for business income losses in the absence of “direct physical loss of or damage to property,” which “requires physical damage to the insured property itself as a condition of coverage.” The court held that the COVID-19-related government orders did not satisfy this requirement, and that the presence of COVID-19 “in the air or on surfaces of a covered property does not qualify as damage to the property itself.”

Partners Kevin F. Buckley and Jodi S. Tesser represented Security National Insurance Company.

You can read the decision  here.

This decision was reported in Mealey's  Daily News File and Mealey's Catastrophic Loss.

Originally published 2 July 2021

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