BI rulings, life insurance, home sales
Recent federal court rulings in Florida this month continue to favor insurance companies in actions against them for business interruption (BI) insurance claims stemming from the coronavirus pandemic. Meanwhile, life insurance companies are putting new restrictions on former COVID-19 patients seeking life policies, while Florida’s housing market is making big gains despite the pandemic. It’s all in this week’s digest of coronavirus news impacting the Florida market.
BI Rulings: In three separate rulings this month, all in U.S. District Court for the Southern District of Florida in Miami, judges found that COVID-19 did not cause “direct physical loss of or damage to” property, and dismissed the cases. The rulings were in Island Hotel Properties, Inc. v. Fireman’s Fund Insurance Co., Carrot Love, LLC v. Aspen Specialty Insurance Co., and Mena Catering, Inc. v. Scottsdale Insurance Co. In the Mena case, the plaintiff claimed COVID caused “a distinct alteration of the Insured Property which cannot be repaired through a one-time disinfection, and thus has some permanency.” The judge ruled that even if that were the case, “the Complaint still fails to allege a “direct physical loss of or damage to Covered Property…caused by or resulting from any Covered Cause of Loss.” These three rulings follow others from late last year, including one prominent case we reported involving a Tampa sports bar.
Life Insurance: Reuters reports that global life insurance companies are imposing restrictions on new policies for those who have COVID or have recovered from it. The restrictions include 30-day waiting periods to apply and coverage limits for certain age groups. Prudential, Aviva, and Optimum Re Insurance were all quoted in the story and said the uncertainty about long-term consequences of the coronavirus for those who’ve had it, make it difficult to adequately predict how many people may ultimately file for death or disability claims. The story said 10% of COVID-19 patients are still sick three weeks after recovering from the illness, and 5% continue to feel sick even longer, according to a study by King’s College London.
Florida Home Sales: The pandemic has had a big impact – in a good way – on the bottom line for home sales in the Florida real estate market. December numbers are in and show that sales of single-family homes rose 21% from December 2019, with condo and townhouse sales up 27.7%. Pending sales are up 30.7% and 42.6% respectively. Prices, too, are up. The statewide median sales price for single-family existing homes was $309,000, up 14.4% from the previous year; the median price for condos/townhouses was $230,000, up 13.7%. Florida Realtors note that “a continued shortage of for-sale inventory is having an impact on prices and attainable, affordable housing.” As we’ve reported, pent-up demand and mass migration to Florida are credited for the tremendous increase in real estate activity in the Sunshine State over the past few months.
LMA Newsletter of 2-1-21
