The COVID-19 pandemic has taken a toll on numerous industries, and dental clinics are no exception. According to a recently filed class action lawsuit, dental clinics have reportedly been denied insurance coverage for the losses they suffered due to the forced business interruption they are experiencing during this global crisis.
Plaintiff Centre Dentaire Boulevard Galeries d’Anjou Inc. is a Quebec dental clinic with 20 to 25 employees. The dental clinic is insured by defendant L’Unique Assurances Générales Inc. and its insurance policy includes Business Interruption Insurance that covers losses sustained from business interruptions, the proposed dental clinic class action lawsuit says.
The Business Interruption Insurance policy “covers the loss of business income actually sustained and directly resulting from the necessary reduction or interruption of the Insured’s activities caused by an insured peril that has affected the insured property,” according to the dental clinic class action lawsuit.
The plaintiff notes that there is no clause in the policy to indicate the exclusion of a pandemic, virus, or a health crisis.
As the novel coronavirus spread globally, governments began to take critical actions to slow its spread. Canada began taking action in March to limit the spread of COVID-19, an illness caused by the novel coronavirus.
“As a result of COVID-19, many businesses, including but not limited to dental clinics, were declared by the government as non-essential and had to close, reduce or interrupt their business,” the dental clinic class action lawsuit states. “In conjunction with the Minister of Health and Social Services and the public health authorities, the Order of Dentists ordered its members, including [Centre Dentaire Boulevard Galeries d’Anjou], to postpone all appointments, save for certain emergencies.”
These measures were reportedly taken due to the nature of dental clinics, which require dentists, staff and patients to share common spaces, furniture and equipment. Further, dental procedures frequently involve the generation and spread of saliva and blood particles, increasing the risk that the highly-contagious virus could spread.
Centre Dentaire Boulevard Galeries d’Anjou closed its dental clinic indefinitely starting on March 16, according to the dental clinic class action lawsuit, and made an insurance claim for business interruption insurance. However, L’Unique has reportedly refused to indemnify the dental clinic for its business interruption claim even though its insurance plan provides coverage for this type of loss.
According to the dental clinic class action lawsuit, the plaintiff and the putative Class Members “paid for business interruption insurance in the expectation that the defendant would honour its contractual obligations in good faith if and when an unforeseen and unintentional occurrence were to take place resulting in an interruption of business.”
Centre Dentaire Boulevard Galeries d’Anjou says L’Unique has failed to honor its contractual obligations to provide coverage for business interruption losses related to the COVID-19 pandemic.
The plaintiff says it has suffered approximately $165,000 in losses, which should be covered by the insurance policy. The dental clinic will reportedly continue to sustain losses due to the business interruption caused by the COVID-19 pandemic, and estimates that the losses will amount to several hundred thousand dollars after 12 months.
The dental clinic says it is not alone and seeks an order requiring L’Unique to pay the amount it is required to pay other dental clinics for their COVID-19 related business interruption losses.
Class Members of the proposed dental clinic class action lawsuit include: “All businesses engaged in the practice of dentistry of a sub-specialty of dentistry in the province of Quebec who were forced to reduce or interrupt their businesses as a result of COVID-19 and were denied coverage for Business Interruption Insurance by L’Unique Assurances Générales Inc.”
The dental clinic class action lawsuit seeks damages on behalf of all Class Members in the amount set forth in the insurance policy’s formula for business interruption losses.
Another class action lawsuit was recently filed against 10 of the largest insurance providers in Canada and Saskatchewan over allegations they are refusing to pay business owners for losses related to the COVID-19 pandemic. Insurance companies in the United States are also being hit with similar class action lawsuits.
What do you think about the dental clinic COVID-19 insurance coverage class action lawsuit? Should dental clinics be covered for losses they suffered due to the pandemic? Tell us your opinion in the comment section below!
Centre Dentaire Boulevard Galeries d’Anjou is represented by Robert Kugler and Stuart Kugler of Kugler Kandestin LLP.
The Dental Clinic COVID-19 Insurance Coverage Class Action Lawsuit is Centre Dentaire Boulevard Galeries d’Anjou Inc. v. L’Unique Assurances Générales Inc., Case No. 500-06-001054-200, in the Superior Court of Québec, District of Montreal, Canada.
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