Ontario's Superior Court of Justice has certified a class-action lawsuit against fourteen insurance companies that denied business interruption claims related to COVID-19.
The class action, launched by several small businesses including a suit store, a smoothie shop and a dance studio, claims businesses across Canada suffered billions of dollars in losses after they were forced to close because of the pandemic.
According to court filings, the insurance companies have denied business interruption claims in part because the coverage requires physical loss or damage to the property, which they argue the presence of a virus on the property and government orders restricting operations don't count towards.
The class action certified on Aug. 20 by Justice Edward Belobaba against the group of insurers that include the Co-operators General Insurance Company and Intact Insurance is separate from other class action lawsuits certified last month against the Canadian subsidiary of UK-based Aviva plc.
Aviva, which faces class action lawsuits brought by a windows company, a branch of the Royal Canadian Legion and a denturist, has been singled out because it offers more coverage related to situations like the pandemic than the other 14 insurers being sued.
According to court filings, unlike the others it specifically offers coverage for business income loss caused by restricted access to the property because of government orders related to an outbreak of a contagious or infectious disease. The company says the policy doesn't cover provincewide shutdown orders.
This report by The Canadian Press was first published August 30, 2021.
The Canadian Press
