advertisement

St. Charles bar sues insurer, argues special policy should cover COVID-19 losses

Alley 64, a St. Charles bar and grill, has filed a breach of contract lawsuit against its insurer, arguing "contamination coverage" in its 2006 commercial insurance policy should cover business losses from the mid-March shutdown due to the COVID-19 pandemic.

The lawsuit seeks damages in excess of $50,000, and class-action status against Society Insurance, arguing the Wisconsin-based firm has "arbitrarily" denied all of Alley 64's claims.

"Prior to the COVID-19 pandemic, the plaintiff purchased a commercial insurance policy which included 'contamination cover' that was specifically designed to protect plaintiff's business for losses sustained due to closures associated with public health risks," read part of the suit, filed this week in Kane County.

"In breach of its insurance obligations that it voluntarily undertook in exchange for plaintiff's premium payments, Society, acting in bad faith, has arbitrarily and vexatiously refused to adjust plaintiff's claim for losses," the suit continued.

Messages left with Society Insurance this week were not immediately returned.

Peter Flowers, the lead attorney in the lawsuit, could not immediately be reached.

The lawsuit argues that pandemic viral outbreaks are far from new - citing the 1918 Spanish Flu, Asian Flu of 1957 and more recent outbreaks such as Ebola in 2014 and Zika virus in 2015.

The suit argues that Alley 64 and other "non-essential businesses" were forced to close in mid-March under an executive order by Gov. J.B. Pritzker, and loss of income and additional expenses for the 9,200-square-foot bar, which also has a 2,600-square-foot patio, should be covered in the policy.

"Rather than acknowledge that the Businessowners Special Form (in the policy) contamination coverage, defendant Society has categorically denied all of the plaintiff's claims and has refused to cover plaintiff's losses," the suit states. "While its policy was in force, plaintiff sustained, and continues to sustain, losses due to the contamination and continued threat of contamination."

The lawsuit seeks 60% of what a judge or jury determines were losses suffered due to the extended shutdown due to COVID-19, and class-action status for Society Insurance clients with similar policies.

The two sides are due in Kane County court Nov. 6.

Article Comments
Guidelines: Keep it civil and on topic; no profanity, vulgarity, slurs or personal attacks. People who harass others or joke about tragedies will be blocked. If a comment violates these standards or our terms of service, click the "flag" link in the lower-right corner of the comment box. To find our more, read our FAQ.