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With courtrooms shut down for most of 2020, civil jury trials nearly or completely disappeared. Civil cases in many places are now extremely backlogged and with many cases unlikely to be heard for years. See, for example, Benjamin Gideon, “Maine Voices: To delay resuming civil trials is to delay justice,” Portland Press Herald, April 30, 2021.
Early into the pandemic, insurance lawyers and consultants began discussing ways companies could “capitalize” on the pandemic, which meant taking advantage of the case backlog to force sick and injured people to accept lowball settlement offers. Susanne Sclafane, “COVID-19 Court Delays May Turn the Social Inflation Tide,” Carrier Management, May 29, 2020.
Indeed, this is exactly what happened. Brittany Kriegstein and Noah Goldberg, “With no trials because of COVID-19, victims are left waiting to settle their civil lawsuit cases,” New York Daily News, February 21, 2021; Ronald D. White, “What happens when COVID shuts civil courts?” Los Angeles Times, September 11, 2020.
California and consumer groups tried to stop these practices but not much could be done. Consumer Federation of America, Letter to Commercial Insurance Executives, June 4, 2020; California Notice: Some Insurers Exploiting COVID-19 Court Closures, A.M. Best, May 20, 2020.
Notably, when it comes to one type of claim – business interruption – companies have refused even low-ball settlement offers. Instead, insurers have aggressively fought small businesses and paid out very little. “Moody’s Says COVID-19 Impact on P&C Insurance Sector Was ‘Moderate,’” Claims Journal, May 24, 2021 (“Businesses have filed about 1,700 business-interruption claims because of COVID-19 shutdowns, but those cases are largely being decided in favor of insurers, Moody’s said”); Noor Zainab Hussain and Suzanne Barlyn, “Travelers Insurance Profit Soared in Q4 on Fewer Claims, Investment Gains,” Insurance Journal, January 21, 2021.