In Fontainebleau Fla. Hotel, LLC v. Westchester Surplus Lines Ins. Co., No. 3D23-1264 (Fla. 3d DCA Mar. 19, 2025), the Third District held that business owners were not entitled to coverage for revenue losses from the suspension of business operations during the COVID-19 pandemic. The policy’s Business Interruption Clause provided for “Loss of business income resulting from necessary interruption of business conducted by the insured, whether total or partial, and caused by loss, damage, or destruction covered herein during the term of the policy to real and personal property…” Although the clause did not limit coverage to direct physical loss, the Court looked to the policy’s “Perils Insured Against” section to determine the type of “loss, damage, or destruction covered herein.” The Court held, “When read as a whole, the policy’s plain language shows that the loss, damage or destruction ‘covered herein’ refers to the Perils Insured Against provision, which explicitly requires ‘direct physical loss’ or property damage.”
This case is yet another example of the courts’ intention to interpret policy provisions using their “plain language” and emphasizes the importance of reading the policy “as a whole” to determine coverage.
View the opinion here.
