Ninth Circuit Is Exhausted by Covid Insurance Claims Suit
Barry Zalma
Jul 28, 2023
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Khatchik Hairabedian d/b/a Kris Mobil (“Khatchik”) appealed from the district court’s order granting Defendant Security National Insurance Company’s (“Security”) motion to dismiss this action for insurance coverage in Khatchik Hairabedian, Dba Kris Mobil v. Security National Insurance Company, a Texas Corporation, No. 22-55355, United States Court of Appeals, Ninth Circuit (July 21, 2023) applied its precedent.
THE CLAIM
Khatchik sought coverage from its insurer, Security, for COVID-19 related economic losses. However, the policy had a virus exclusion that provides: Security “will not pay for loss or damage caused by or resulting from any virus, bacterium or other microorganism that induces or is capable of inducing physical distress, illness or disease.” The virus exclusion “applies to all coverage under all forms and endorsements,” in the policy, including “forms or endorsements that cover business income, extra expense or action of civil authority.”
Khatchik argued that the virus exclusion does not apply because government orders, not COVID-19, caused the losses. Here COVID-19 is the efficient proximate cause of Khatchik’s alleged losses.
Khatchik also contended that the virus exclusion does not apply to pandemics because Security chose not to use a publicly available “pandemic exclusion” in its policy. The Ninth Circuit disagreed. Arguing that the Virus Exclusion does not apply to bar coverage for losses stemming from the COVID-19 pandemic defies the plain and unambiguous text of the Policy and is akin to arguing that a coverage exclusion for damage caused by fire does not apply to damage caused by a very large fire.
ZALMA OPINION
It is time that courts stop dealing with lawsuits seeking insurance coverage resulting from Covid-19. They continue to fill the trial and appellate courts and they continue to lose. They are causing unnecessary expense to the plaintiffs, the insurers and the courts. Considering the volume of precedent it is beginning to be considered a frivolous law suit that would subject the parties and their lawyers to sanctions.
(c) 2023 Barry Zalma & ClaimSchool, Inc.
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Can read and understand the insurance policies issued by the insurer.
Understands the promises made by the policy.
Understand their obligation, as an insurer’s claims staff, to fulfill the promises made.
Are competent investigators.
Have empathy and recognize the difference between empathy and sympathy.
Understand medicine relating to traumatic injuries and are sufficiently versed in tort law to deal with lawyers as equals.
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Understand how to negotiate a fair and reasonable settlement with the insured that is fair and reasonable to both the insured and the insurer.
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My Training to be an Insurance Claims Adjuster
When I was discharged from the US Army in 1967 I was hired as an insurance adjuster trainee by a professional and well respected insurance company. The insurer took a chance on me because I had been an Army Intelligence Investigator for my three years in the military and could use that training and experience to be a basis to become a professional insurance adjuster.
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