Thor Equities attempts to pierce FM Global’s BI sub-limit with $20m suit
FM Global is being sued by a commercial property owner in New York for Covid-19 rental and business interruption (BI) losses that it argues should be covered by its property policy.
According to a report on Law360, Thor Equities is seeking $20m to cover loss of rental income on commercial properties in several US cities after tenants closed in state-ordered lockdowns.
The real estate owner said it holds a $750m limit property policy, but it carries a $1m communicable disease sub-limit. The case was filed with a New York federal court last week.
Thor alleges that FM Global subsidiary Factory Mutual acknowledged losses for communicable disease response and interruption by communicable disease, but did not acknowledge claims for loss under other endorsements, including civic authority and loss of access to the properties, which would have opened the doors to a higher claim.
This means Factory Mutual would cover only $1m of Thor’s $20m loss from the pandemic claim. Thor argues Factory Mutual should cover all its loss for rent and other BI at its properties.