Uncork and Create LLC v. The Cincinnati Insurance Co., No. 21-1311 (4th Cir. 2022)
Annotate this CaseThe Fourth Circuit held that, under West Virginia law, the insurance policy language requiring a "physical loss" or "physical damage" unambiguously covers only losses caused by, or relating to, material destruction or material harm to the covered property. In this case, the insured seeks coverage for lost business income and other expenses resulting from the Covid-19 virus and a related, state government order temporarily halting non-essential business activities. Although the court, like the district court, recognized that the insured and other businesses suffered severe losses during the period that the closure order was in effect, the court concluded that under the unambiguous terms of the policy, coverage is not available for the insured's loss of business income and related expenses absent material destruction or material harm to the covered property. Accordingly, the court affirmed the district court's dismissal of the complaint.
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