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insurance policy To some extent, Jones also apparently considered other federal opinions, including some outside of the Third Circuit, on the issue of claimed COVID-19-caused loss coverage under policies covering “physical” loss or damage.

A Pennsylvania federal court has dismissed a restaurant’s legal claims against its insurer that alleged it was owed loss coverage after public officials implemented stay-at-home orders in response to the coronavirus threat. The court’s ruling pointed to an insurance policy’s “unambiguous” language centered on its insured restaurant’s “physical” losses.

At the center of the case, Maudlin’s, a now-shuttered restaurant in South Carolina, sued its commercial insurer, Pennsylvania National Mutual Casualty Insurance Co., in May 2020 after the company denied its claim for losses tied to customers staying away from the restaurant as COVID-19 spread and officials urged them to remain home.

Maudlin’s and former owner Richard Kahn had hoped their business losses would be covered by an “all-risk” policy they’d bought from National Mutual Casualty that covered all risks of loss unless expressly excluded, according to U.S. District Judge John Jones III of the Middle District of Pennsylvania, and they had brought claims for breach of contract, breach of the duty of good faith and fair dealing and declaratory relief.

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