Mohegan Sun Casino Files Lawsuit Over COVID-19 Claims
The Mohegan Sun Casino in Connecticut has filed a lawsuit against its insurance company due to failure to fulfill COVID-19 claims.
Businesses hire insurance companies for a variety of reasons. Insurance is needed for employee’s health needs as well as for the company to have coverage based on potential losses, such as from a fire or storm damage. After the COVID-19 pandemic started last year, many companies were affected due to government shutdowns. Insurance claims were filed based on the effect of the pandemic, yet insurance companies are not paying up. The Mohegan Sun Casino in Connecticut is the latest venue to file a lawsuit after its insurance company did not pay millions of dollars in pandemic coverage claims.
Suing Factory Mutual Insurance Co.
On Friday, the Mohegan Tribal Gaming Authority filed a lawsuit against the Factory Mutual Insurance Co. The filing was completed in a New London court and the insurance company is based in Rhode Island.
A similar action was taken by the Mashantucket Pequot Tribe, the operator of the Foxwoods Resort Casino in Connecticut. The tribe is seeking over $70 million in losses due to the COVID-19 pandemic. The same insurance company is named in this lawsuit.
In the Mashantucket claim, the policy is said to be worth up to $1.655 billion in cover due to a single occurrence. Factory Mutual disputes the claims, stating the issue is not covered within the operator’s policy. The insurance company wants the lawsuit throw out of court. A judge is set to hear the case on August 2.
The COVID-19 pandemic begs the question as to what an All-Risk insurance policy pertains to. It has been a century since the United States has dealt with a pandemic, so it was not a specific item listed in a policy. Factory Mutual feels that viruses are not included in coverage. It appears as though a court ruling is going to be needed to give precedence in this case. Whatever a judge decides is likely to be upheld in other courts around the country as companies try to fight for compensation from insurance claims filed.
The lawsuits filed by the Connecticut Native America Tribes are not the first in the US to include claims regarding casino facilities and the COVID-19 pandemic. Other casino operators in the nation have filed suit in an attempt to get insurance companies to pay up.
Caesars Entertainment has filed several lawsuits against insurance companies. The gaming operator says that its insurers have denied payouts of around $2 billion losses connected to the pandemic. Companies like Lloyds of London and Chubb are named in the filings. According to reports, the company has named a total of 60 insurers in its lawsuits.
Phil Ruffin is the owner of the Circus Circus casino that filed a lawsuit against its insurers due to COVID-19. The case was dismissed by a judge and AIG Specialty Insurance Co. was off the hook. However, the attorneys for Ruffin have plans to appeal the ruling.
Because so many companies have been left unable to receive payment from insurance claims during the pandemic, lawmakers are trying to come up with a solution if this were to happen in the future. In New Jersey, lawmakers are considering legislation that would see losses from a pandemic covered under a business interruption policy in the future. Of course, legalizing the legislation will take some time and will not help in this instance.
We shall see in the coming weeks how the lawsuit filed by the Mohegan Sun fares. Will it be able to gain headway and set up a precedence for lawsuits in the future? Or will it be dismissed like other cases in the past.