Intact Insurance Facing Multiple Class Action Lawsuits

UPDATE: The Top Class Actions Canada Coronavirus Business Interruption Insurace Coverage investigation is now open. If you are a British Columbia business owner who was forced to temporarily close due to COVID-19, and had your insurance claim denied, submit your information here!

In recent legal news, yet another Intact Insurance class action lawsuit has been filed over allegations the company wrongly denied business income loss claims filed in the wake of the coronavirus pandemic.

Lead plaintiff, Dr. Amer A. Khakwany, Inc., a B.C. based dental office, filed the proposed Intact class action lawsuit in British Columbia’s Supreme Court. According to the Intact class action lawsuit, the company purchased and paid regular premiums for an “all-risks” insurance policy from Intact. The policy allegedly covered the following:

• Direct physical losses to the plaintiff’s property
• Losses resulting from damage to neighboring businesses that restrict access to the plaintiff’s business
• Losses or damage to the plaintiff’s business from lack of access to their property under prohibitions implemented by order of a Civil Authority

“Such ‘all-risks’ commercial insurance contracts provide peace of mind to business owners, including the Plaintiff and class members, because insurers will cover business losses if the unforeseen occurs,” reasons the Intact Insurance class action lawsuit. “Coverage include[s] all risks of physical loss or damage. These broad policies can only be narrowed by specific exclusions and conditions, such as a virus or pandemic exclusion. The policies at issue in this case did not include any such exclusions.”

Despite purchasing Intact Insurance’s all-risk policy, the plaintiff alleges that its claim for business losses due to COVID-19 restrictions that shut down most of the nation was denied. The owner of the dental office, Dr. Khakwany, alleges that he maintained insurance through Intact between March 14, 2020 through March 14, 2021; however, when he filed a claim with the company on March 17, 2020, it was denied. The plaintiff says that he followed up with the insurer in April hoping for a reconsideration of the denial, but has not received a response to this communication.

The Intact Insurance class action lawsuit explains that starting on March 17, 2020, provincial governments began enacting restrictions to stop the spread of COVID-19, a novel coronavirus that is highly contagious and can result in severe illness and even death. Under these restrictions, the plaintiff and other businesses were forced to close in the interest of public health. The plaintiff says that his dental office was closed from March 17 through June 17, 2020.

The Intact Insurance class action lawsuit also points out that the coronavirus is known to remain on surfaces undetected for an extended period of time. Businesses have no way of knowing if their premises are contaminated with the virus, presenting the threat of exposure to employees and customers. The plaintiff says that, as a result, his business was rendered “unsafe and unusable.”

Despite these conditions and the fact that his business carried an all-risks policy through Intact Insurance, the plaintiff says that his claim for the period that his business was closed due to COVID-19 was denied.

This proposed Intact Insurance class action lawsuit seeks to represent all Canadian residents, excluding those in Quebec, who had business interruption insurance through Intact from March 17, 2020 to the present.

The plaintiff is seeking damages for his business and on behalf of Class Members, including business losses along with punitive damages.

Mounting Claims Alleging Intact Insurance Denials

This is not the first proposed class action lawsuit filed against Intact Insurance alleging the company wrongly denied claims from Canadian business over losses suffered due to coronavirus shutdowns. In the spring, a Montreal wholesale construction company filed a complaint alleging Intact refused to pay their business interruption claim. The company alleged that it suffered over $1 million in losses when the province of Quebec shut down in an attempt to slow the spread of the virus, but, despite regularly paying premiums to Intact for insurance that would allegedly help cover those losses, the insurer outright denied the claim.

Another Intact Insurance class action lawsuit was proposed by a Montreal catering company. The catering company contended that it purchased an all-risks policy from Intact as well; however, when its business was severely restricted by COVID-19 shutdowns affecting food and drink establishments, its claim for damages was denied by Intact Insurance. According to the plaintiff in that class action lawsuit, Intact argued that the business must suffer a physical loss in order to make a claim.

Intact Insurance is not the only insurance company to face legal action for allegedly wrongly denying business interruption insurance claims in the aftermath of the COVID-19 pandemic. Businesses across Canada allege that they are being denied claims for losses under their policies, putting them in economic peril despite carrying insurance they thought would protect them in this type of situation.

Do you run a business that suffered losses due to coronavirus restrictions? Have you tried to file a claim through your insurance? Tell us what happened in the comment section below!

The lead plaintiff and proposed Class Members are represented by Douglas Lennox and Darren S. Sall of Klein Lawyers LLP.

The Intact Insurance Class Action Lawsuit is Dr. Amer A. Khakwany Inc. v. Intact Insurance Company, Case No. VLC-S-S-206399, in the Supreme Court of British Columbia, Canada.

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