Chubb, which is also the parent company of Pacific Indemnity, is a common insurer of arts organizations. Weeks into the pandemic, the company’s chief executive, Evan Greenberg, caused a stir among clients when he said in an earnings call that business interruption insurance “doesn’t cover Covid-19” and that “the industry will fight this tooth and nail.”
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Frequently Asked Questions
Updated August 27, 2020
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In a statement responding to Jujamcyn’s lawsuit, Chubb said that it had paid out millions of dollars this year for the pandemic-related disruption of Broadway performances but that most standard property insurance policies do not cover pandemic risk when it comes to business interruption.
“Creating false expectations about coverage that does not exist, including filing baseless lawsuits, will not solve this crisis,” it said.
Jujamcyn said in its lawsuit that it should also be granted insurance payments based on the fact that state and local government had shut its theaters down. The state’s phased reopening does not yet include indoor theaters.
According to the lawsuit, which accuses both Federal Insurance and Pacific Indemnity of a breach of contract, part of the reason that Jujamcyn’s business income insurance claim was denied was because the governmental orders did not prohibit access to the theaters, meaning theater employees were not barred from entering and checking on the buildings. Mr. Schulman called that a “ludicrous position.”
The second part of the lawsuit argues that Pacific Indemnity, which provides Jujamcyn with performance disruption coverage, was wrong in its decision to only grant the theater company one payment of $250,000 for its five theaters. The insurance company said that the pandemic qualified as a single “occurrence,” requiring only one performance disruption payout. Jujamcyn countered that the insurer was suffering from a “serious case of seller’s remorse” and actually owed it more than $1 million.
Article source: https://www.nytimes.com/2020/08/27/theater/jujamcyn-theaters-insurance-lawsuit.html
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