With a decision of January 26, 2022, the Federal Court of Justice denied insurance claims by a catering business for the Corona-related closure of the first lockdown in 2020. Crucial questions remain unanswered for many pending cases however.
In principle, insurers can effectively limit the scope of coverage of a business closure insurance with a list of named diseases and pathogens in insurance conditions. This was determined by the Federal Court of Justice (Bundesgerichtshof; BGH) with today's decision (Az. IV ZR 144/21).
Restaurant operator hoped for insurance benefit for lockdown
In the dispute that was decided, the operator of a restaurant in Schleswig-Holstein had claimed business closure insurance cover from its insurer for the Corona-related closure in spring 2020. A business closure insurance compensates for the loss of earnings if a business is temporarily closed by an official order for reasons of infection control (other than a business interruption insurance which compensates for loss following a property damage).
The defendant insurer – like almost all business closure insurers in Germany – refused to pay. The argument: a Corona lockdown is not an insured event because the Sars-CoV-2 coronavirus and the disease Covid-19 are not mentioned in the insurance terms. Furthermore, for an insured event, a pathogen must be detected within the company's building and the official order must therefore be specifically directed against the single company affected, the insurer stated. The Lübeck Regional Court (Az. 4 O 164/20) and the Schleswig Higher Regional Court (16 U 25/21) followed this argument.
BGH: The refusal of performance by the business closure insurer was lawful
The BGH now partly agrees with this argument. The wording of the clause used by the insurer read: "Notifiable diseases and pathogens within the meaning of these additional conditions are the following diseases and pathogens specified by name in Sections 6 and 7 of the Infection Protection Act: [a longer list follows]". This wording would make it sufficiently clear to the policyholder that only the diseases and pathogens mentioned in the list are insured. The policyholder cannot expect insurance cover that extends to every official closure of a business on the basis of the Infection Protection Act, the BGH ruled.
In parts, however, the BGH also rejected the previous OLG case law: For the insured event in the business closure insurance, it is not important whether there is a risk of infection arising from the business itself, i.e. that the pathogen appeared there.
Judgment leaves many questions unanswered
“In the past, the BGH has regularly and correctly placed high demands on the transparency of general business and insurance terms. With today's decision, the Karlsruhe judges are leaving this line," explains Dr. Mark Wilhelm, partner of WILHELM. The law firm advises more than 1,000 affected policyholders on business closure insurance. The firm however was not involved in the currently decided proceedings.
“It is fundamentally to be welcomed that the BGH has created clarity for some of the policyholders, even if the result is not convincing. Despite the judgment, there are still serious doubts about the transparency of many of the clauses used in the market regarding the scope of coverage for business closure policies," says Wilhelm. "The grandiose advertising promises made by insurers, as well as the behavior of insurers and their representatives in pre-contractual advice and in claims settlement, will still have to be scrutinized by the highest court. For example, in many cases, insurers initially promised coverage for Corona-related closures. It will have to be clarified whether these insurers are not liable despite the list clause in their insurance terms. Among other things, the BGH will have to deal with the question of whether the insurers may have violated § 1a Insurance Contract Act in the appeal proceedings we have pending".
Press information (German)