A federal appellate court ruled in favor of Cincinnati Insurance Co. on July 2, finding that the insurer did not have to cover losses stemming from COVID-19 restrictions that an Iowa dental clinic faced.
The initial lawsuit against Cincinnati Insurance Co. came after it refused to compensate Oral Surgeons for nonemergency procedures that were canceled because of pandemic restrictions. That lawsuit fell in favor of the insurer, and the plaintiff appealed to the U.S. Court of Appeals for the 8th Circuit.
In the appellate court, judges primarily ruled that there were no fiscal losses directly related to "loss" of property, which the insurer's policies note must be "physical," according to court documents.
Because the surgeries were canceled because of pandemic restrictions, there was no "accidental physical loss or accidental physical damage" to compensate.
Oral Surgeons also argued that having to shut down offices amounted to physical loss, but the court disagreed, noting that there must be direct "physical alteration of property."