An insurance broker has maintained that the policy of a local sushi restaurant in Victoria, BC does not cover pandemic-related business losses, but lawyers have argued that language in the policy contradicts the broker’s claim.

The restaurant in question, Chikara Sushi, is facing $40,000 in losses after closing its doors for two months in response to the COVID-19 pandemic. It reopened recently, and is only able to operate thanks to support from the government, and the generosity of the landlord.

“The business [is] going down for all of us. I hope it’s going to work,” restaurant owner Tao Nguyen told CHEK News.

Nguyen made an insurance claim for the losses, but he was informed by broker Megson Fitzpatrick Insurance in an email that “there is nothing in the insurance policy that covers wages lost due to a pandemic.”

However, a part of Nguyen’s policy reads:

“This policy insures up to a limit of $25,000 loss…resulting from interruption of or interference with the business carried on by the insured at the premises as a direct result of:

a) an outbreak of a notifiable human infectious or contagious disease within 20 kilometers of the premises.”

A lawyer commented that the language applies to pandemic-related business shutdowns.

“That covers exactly this type of situation,” David Klein, a managing partner at Klein Lawyers, told CHEK News. “These are the kinds of events that people purchase their coverage for.”

Klein added that his Vancouver-based firm has been contacted by dozens of other business owners who claim to have been wrongfully denied insurance payouts. The law firm is also preparing lawsuits to file against the insurers involved.

“[Insurers are] sitting on billions of dollars in reserves that are meant to cover exactly this type of event,” Klein said.

In a statement to CHEK News, Megson Fitzpatrick Insurance explained its stance on the matter.

“We have had several COVID-related claims reported to us and we are doing everything we can to find positive outcomes for our clients,” it said.