Texas court overturns Baylor's $12mn Covid damage verdict against insurers

By Mia MacGregor

Jan 29 - (The Insurer) - A Texas appeals court has overturned a $12mn jury verdict awarded to Baylor College of Medicine for property damage linked to the Covid-19 pandemic, leaving the institution without compensation in a decision that aligns with most rulings in similar cases.

Baylor had filed a claim under an all-risks insurance policy covering "direct physical loss or damage to property" through October 2020.

When the insurers denied the claim for business interruption and other pandemic-related losses, Baylor sued for breach of contract in district court in Harris County.

The jury sided with Baylor, finding that Covid-19 caused direct physical loss or damage to its property. The trial court awarded more than $12mn in damages and attorney's fees.

On appeal, the court ruled the evidence did not support the jury's finding.

“Mindful of the importance of uniformity when identical insurance provisions are interpreted in various jurisdictions, we join the vast majority of courts that have answered this question: No. The evidence in this case is legally insufficient to support the jury’s contrary answer,” the opinion stated.

As a result, the court reversed the trial court’s judgment and ruled that Baylor would receive nothing.

The insurers in the dispute included Sompo International, Neon, Unicorn Underwriting, HCC International, Ace Underwriting Agencies, Talbot Underwriting and QBE Europe.