”
Decision of the Düsseldorf Regional Court on business closure insurance
\n\n
On 26 February 2021, the Düsseldorf Regional Court issued a decision that has attracted attention in the insurance industry and among commercial policyholders, particularly in the hospitality sector. In the present case, a bar operator based in Düsseldorf was awarded a substantial claim under a business closure insurance policy.
\n
Facts of the case and course of proceedings
\n
Initial situation of the insured event
\n\n
The claimant operated a bar in Düsseldorf. As a result of official orders to contain the COVID-19 pandemic, the business had to cease operations from mid-March 2020 for several weeks. The entrepreneur had business closure insurance that provides for compensation for losses resulting from official closures.
\n
Positions of the parties
\n\n
The policyholder demanded compensation payments from the insurer for the duration of the closure ordered by the regulatory authorities. The insurance company refused to settle the loss, arguing that the coronavirus was not explicitly listed as an insured event in the General Insurance Conditions (AVB).
\n
Legal assessment by the court
\n\n
The Düsseldorf Regional Court examined the interpretation of the contractual terms, in particular in light of the Infection Protection Act. In the court’s view, it is not solely decisive whether the SARS-CoV-2 virus was specifically listed in the AVB at the time the contract was concluded, but rather whether closures based on the Infection Protection Act generally fall within the scope of insurance cover.
\n
Legal assessment and reasons for the decision
\n
Interpretation of the insurance conditions
\n\n
The court clarified that the term notifiable diseases, within the meaning of standard terms and conditions, is to be interpreted broadly. The absence of an express mention of COVID-19 or SARS-CoV-2 in the contractual list therefore does not constitute an exclusion of benefits, provided that the official measure relevant to the insurance cover is based on the Infection Protection Act.
\n
Entitlement to insurance benefits
\n\n
In view of the regulatory prohibition of the bar’s operation, the court rejected the insurer’s argument and, in the specific individual case, affirmed the existence of an insured event. The bar operator therefore received substantial compensation for the loss of earnings resulting from the closure.
\n
Implications for policyholders
\n\n
The decision of the Düsseldorf Regional Court is trend-setting for hospitality businesses and comparable companies that rely on business closure insurance. The interpretation of the terms in favor of policyholders strengthens their position when asserting claims arising from pandemic-related business closures. However, the question of the scope of insurance cover remains dependent on the individual case and continues to be assessed differently in various jurisdictions.
\n\n
An individual review of existing insurance contracts and the respective requirements for claims is advisable in individual cases. Anyone wishing to inform themselves about the legal framework and prospects in comparable constellations can find comprehensive information at MTR Legal Rechtsanwälte under Legal advice in commercial law.
“
