Live Nation is suing it’s insurance company Factory Mutual for its refusal to cover the “hundreds of millions” in losses as a direct result of the pandemic.
The issue lies with Factory Mutual declining to honor its premium policy set in place, agreed upon, and sold to Live Nation for a significant expense in June 2019. The policy lasted through June 2020. According to the lawsuit filed in California Federal Court in January 29, 2021, the language that Factory Mutual outlined in its contract confirms that communicable diseases, such as COVID-19, are covered. Furthermore, Live Nation’s outside council Marc D. Halpern stated, “… the policy specifically designates communicable disease as a covered cause of loss.” Factory Mutual says it will deny nearly all coverage for its current policyholders who have claimed losses in regards to COVID-19.
Live Nation states that COVID-19 outbreaks affected 35 company locations/venues. Additionally, there were also 62 infections of its employees during the first few months of the pandemic in early 2020. The policy purchased by Live Nation is the Global Advantage All-Risk property insurance policy. This portion of the policy specifies that even though communicable diseases are a covered cause of loss, “pathogens, viruses, or other disease causing agents” are not. The lawsuit notes that the policy’s purpose is “meant to protect the insured against all risks of loss, whether known or unknown.”
As it turns out, Live Nation is not the only group suing Factory Mutual. Entities like NYU, the Atlanta Falcons, and Ralph Lauren are part of this growing list. Ultimately, lawsuits are becoming a common occurrence in relation to COVID-19 damages. In short, Factory Mutual’s defense is that their provisions on damage and property loss only applies to physical damage; not losses caused by mandated government closures and shutdowns.
Stay tuned for further developments on this matter.
h/t: Dancing Astronaut, Billboard
