‘Communicable Diseases’ Provision May Cover COVID-19 Losses, Mich. Federal Judge Rules
February 5, 2021
DETROIT — A Michigan federal judge has refused to dismiss a salon’s COVID-19 business interruption coverage action against West Bend Mutual Insurance Co., finding it has sufficiently stated a claim under the policy’s Communicable Diseases coverage.
In a Feb. 4 order, Judge Sean F. Cox of the U.S. District Court for the Eastern District of Michigan explained that “a special grant of coverage for communicable diseases followed by an exclusion for virus or bacteria cannot plausibly exist in the same policy.”
Salon XL Color & Design Group LLC, an Ann Arbor, Mich., hair salon, was forced to close in …