In a September 2021 appeal judgment in Ohio USA, the court held that the State’s order to suspend all in-person dining operations at restaurants to slow the spread of the virus resulting in considerable loss of revenue for the insured was not a loss covered under the insured’s business interruption policy “caused by direct physical loss of or damage to property”. The court wisely commented:

“There is indeed nothing common about the language of insurance contracts. Then again, there is nothing common about the task at hand – capturing risk and what to pay for it, pricing unknowable future perils in a fair and predictable way. This is a specialized field of language, and aptly so…  While there may be nothing common about the words found in insurance contracts, they often generate an ordinary meaning when anchored in the special context in which they are written.” 


“That leaves a hard reality about insurance. It is not a general safety net for all dangers.

If risk is not having money when you need it, insurance is one answer to perilous events that could prompt a sudden drop in revenue.

Fair pricing of insurance turns on correctly accounting for the likelihood of the occurrence of each defined peril and the cost of covering it.

Efforts to push coverage beyond its terms creates a mismatch, an insurance product that covers something no one paid for and, worse, runs the risk of leaving insufficient funds to pay for perils that insureds did pay for.

 That is why courts must honour the coverage the parties did—and did not—provide for in their written contracts of insurance.”

The judgment is Santo’s Italian Café LLC v Acuity Insurance Company No. 21-3068 (6th Cir. Sept. 22, 2021).