Walt Disney Company sued by insurer over COVID exposure claims: Risk and insurance
Entertainment conglomerate Disney is seeking insurance coverage for COVID-related production shutdowns.
When COVID-19 hit U.S. shores, every business with in-person interaction had to re-evaluate how to proceed without risking exposure to the disease.
This included the entertainment industry.
Walt Disney Co., the $ 122 billion entertainment conglomerate, was forced to delay and stop film production for a number of film and television projects in March 2020.
Later that year, production resumed, but as the virus raged across the country in waves, shutdowns and delays continued.
Disney turned to insurer Fireman’s Fund Insurance Co. for coverage. In the claim, Disney asked for up to $ 10 million to recover losses resulting from production shutdowns during the pandemic.
The Fireman’s Fund denied the request.
He said that while he did not dispute claims related to the “first wave” of COVID-19 closures ordered by state and local governments in March 2020, he believed the claims stemming from the “second wave” closures were not within its policy.
Those claims have arisen, the Fireman’s Fund argued, as productions have been allowed to resume in California and other filming locations. These Second Wave delays are mainly due to a director being exposed to a “non-essential” worker who tested positive for COVID-19, shutting down production for a 14-day quarantine.
Disney countered that it was covered by its Actor Coverage policy, a type of insurance commonly used for Hollywood productions, which compensates producers for “any loss or additional expense to complete principal photography due to death, injury or illness of any artist insured by the director. “
The Fireman’s Fund explained that expenses resulting from “covered cast / crew members, who were otherwise in good health, should be quarantined due to exposure to people who tested positive and / or infected. Are not covered.
Disney continued to back down.
Scorecard: Fireman’s Fund has filed a lawsuit against Disney for coverage of production delays. No verdict has been rendered.
To take with: Even the most powerful have felt the constraints of COVID. Businesses large and small will continue to claim coverage due to closures, and insurers must prepare for precedents set by the courts. &