COVID-19 – business interruption insurance

Nater Dallafior advised and represented a group of companies – being the policyholder – against its insurer in connection with the policyholder's claim for coverage based on a business interruption insurance policy.

The policyholder is active in the area of health services and was forced to close major parts of its business due to the Swiss Federal Government's measures against COVID-19. The interruption of business operations caused significant financial damage. Even though the policyholder was protected against such losses through its business interruption insurance policy, the insurer tried to deny coverage and remained reluctant to cover the financial damage. The case involved several complex issues of insurance law, including the scope of the insuring clause of a business interruption policy, the scope of co-insured entities, the application of statutory insurance law provisions concerning underinsurance in the realm of business interruption insurance, the calculation of the insured's damage, and the extent of the policyholder's duty of damage mitigation measures.

Benjamin Schumacher and Roberto Dallafior led the lengthy pre-trial negotiations with the insurer. Ultimately, the matter could be resolved by means of an amicable solution, in which the insurer agreed to cover a significant part of the damage caused by the temporary interruption of the business. Since Swiss insurance law lacks substantive case law concerning business interruption policies, various questions at issue in this case were novel and posed a significant challenge when made subject of negotiations with the insurer.