Germany
Has the official regulator/authority intervened to help resolve contractual uncertainty around the validity of BI claims?
Yes.
The Bavarian Ministry of Economic Affairs, industry associations and some insurers have worked out a solution for companies in the state of Bavaria who have BI insurance. They jointly recommended (not legally binding) that in the event of business closures due to the Covid-19 pandemic, insurers will cover a certain amount of the losses.
Many insurers have announced that they will also apply this scheme in the rest of Germany and thus cover for 10-15 % of the losses. Some insurers have voluntarily declared that they will support their customers even to a greater extent.
Do insurance policies in your jurisdiction generally restrict BI to losses directly resulting from physical damage?
No.
However, this is dependent on the nature of the relevant BI policy. There are BI policies that only cover losses resulting from physical damage of the business or resulting from the failure of public supply of gas, electricity, heat or water. But some BI policies expressly cover losses in cases where the damage is caused by restrictions imposed on a business by the authorities in cases of infectious diseases.
Are there any court proceedings currently dealing with the validity of BI claims?
Yes.
It is expected that a lot of insured companies have filed and will file claims against their insurers.
According to a survey by a local press of Osnabrück (Neue Osnabrücker Zeitung), there are about 80 lawsuits pending before various regional courts nationwide. However, quick decisions are not expected at this time.
The German Association of Judges assumes "that the numerous disputes arising from the Corona crisis will increasingly occupy the courts".
Have any judgments been given that deal with BI claims in relation to the current COVID-19 pandemic or other contagious/infectious diseases?
Yes.
The only relevant case law published so far is the judgment of the Regional Court of Mannheim (LG Mannheim Urt. v. 29.4.2020 – 11 O 66/20).
The peculiarity of the case is that the insured/claimant (who challenged a denial of coverage before court) was a hotelier and that the authorities had interdicted hotels to host tourists only. It was, however, still allowed to host business travellers. The court held the view that the regulation of the authorities de facto led to a complete closure of the hotel since no business travellers would have come anyway because of the pandemic. Therefore, the insurance had to cover the losses.
Furthermore, the judgment supports the view of the insurance companies that they must cover for losses only in case of governmental mandated closure.
Name of regulator, websites and articles of interest
Bundesanstalt für Finanzdienstleistungsaufsicht:
https://www.bafin.de/DE/DieBaFin/AufgabenGeschichte/Versicherungsaufsicht/versicherungsaufsicht_node.html
Website of the German Insurance Association:
https://www.gdv.de/de/betriebsunterbrechung---allgemeine-sachversicherung-6074
Bavarian Ministry of Economic Affairs:
https://www.bayern.de/betriebsschliessungsversicherungen-bayerische-loesung-fuer-hotels-und-gaststaetten/
Article of interest:
https://www.tagesschau.de/wirtschaft/boerse/coronavirus-versicherungen-101.html
