Va. Hospital System Scores Partial Win in COVID-19 Coverage Action Against Zurich Unit

ROANOKE, Va. — A federal judge has refused to dismiss a Virginia hospital network’s $150 million COVID-19 insurance lawsuit against American Guarantee & Liability Insurance Co. to the extent it seeks coverage under the policy’s “Interruption by Communicable Disease” provision.

However, in the Feb. 4 order, Chief Judge Michael F. Urbanski of the U.S. District Court for the Western District of Virginia dismissed Carilion Clinic’s claims for property damage and time element coverage, ruling that neither the virus itself nor related government restrictions caused it to sustain “direct physical loss of or damage” to insured property.

Carilion Clinic and its …