HOUSTON – Hartford Lloyds Insurance allegedly mishandled a COVID-19 business interruption claim, resulting in financial ruin for an area doctor, according to a recently filed lawsuit.
Seeking up to $1 million in damages, Dr. Linh Dang and Springwoods Neurology filed suit against Hartford Lloyds Insurance on June 1 Harris County District Court.
On March 24, County Judge Lina Hidalgo issued a “Stay Home, Work Safe” order. A few days earlier, Gov. Greg Abbott had issued an executive order limiting business activities in hopes of containing the virus.
“Plaintiffs were forced to close their doors as a result of the physical loss of their property due to the presence of COVID-19 and the state and local orders,” the suit states. “As a result … Plaintiffs have sustained income loss and extra expenses.
On April 7, Dang submitted a claim to Hartford for the loss of income and extra expenses.
“Without conducting any investigation into Plaintiffs’ claim, Hartford summarily denied the claim on the very same day … in blatant violation of their duties under the Policy and under the Texas Insurance Code,” the suit states.
“Hartford’s mishandling of Plaintiffs’ claim has caused a delay in Plaintiffs’ ability to remediate the property and continue operation of their business, which resulted and continues to result in additional loss of income and financial ruin.”
Dang maintains Hartford’s liability became reasonably clear when it had notice of the widespread contamination of property by the coronavirus and issuance of executive orders prohibiting certain business activities.
As early as March, trial lawyers specializing in insurance litigation have been trolling for COVID-19 business interruption claims.
Whether or not insurers should foot the bill is an ongoing debate.
According to the Insurance Council of Texas, most business interruption policies have some form of language excluding coverage for virus, bacteria, and pandemic situations.
Dang is suing for actual, consequential and punitive damages.
Woodlands attorneys Jennifer LeMaster and Nejat Ahmed represent her.
Case No. 2020-32809