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A “Very Dangerous Period” for Litigation

A continuing blitz of new lawsuits.
June 10, 2020

Insurers already flooded with a barrage of coronavirus business interruption litigation will probably face a continuing blitz of new lawsuits — likely through the commercial general liability, surety, and trade credit sectors — as the U.S. economy reopens, market observers said.

“We are entering a very dangerous period with respect to broad-based litigation, potentially involving almost every segment of the American economy,” said Robert Hartwig, director of the Center for Risk and Uncertainty Management at the Darla Moore School of Business, University of South Carolina. “It’s a dangerous period because the potential litigation is unprecedented in scale and scope.”

More than 2,295 state and federal lawsuits have been filed over COVID-19, including 374 dealing with insurance matters, as of May 27, according to Hunton Andrews Kurth, a law firm tracking the cases. Most of the insurance cases are for business interruption claims. Observers doubt any new litigation surge will match the depth of the business interruption lawsuits, but a coming wave of legal challenges will nevertheless be substantial.

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