Arch Insurance Hit with Class Action Over Alleged Refusal to Honor Trip Insurance Policies Amid Pandemic

New to ClassAction.org? Read our Newswire Disclaimer

Arch Insurance Company and Arch Insurance Solutions, Inc. face a proposed class action wherein two consumers claim the insurers have, “on a uniform basis,” denied all COVID-19-related travel cancellation claims.

The two plaintiffs, whose trip to Europe was canceled due to pandemic-related travel restrictions, claim that although their Arch travel insurance policy purported to cover losses related to being “quarantined,” and provide at least some reimbursement in the event a trip is canceled “for any reason,” the defendants refused to cover their non-refundable prepaid payments and deposits.

Per the complaint, the plaintiffs purchased from Arch in January 2020 an “Individual Travel Protection Policy” to cover a trip from Pittsburgh to London that was to be followed by a vacation tour between London and Rome to take place from June 18 to 28, 2020. According to the suit, the policy included the following language purporting to provide coverage for trip cancellations due to an “unforeseen reason”:

Among the list of “Other Covered Events” that fall under “Unforeseen” reasons is a circumstance in which the policyholder or their traveling companion is “quarantined,” though the policy does not define the term, the case says.

Moreover, the policy purported to provide coverage in the event the policyholder’s trip is delayed, and even promised to provide reimbursement of up to 75 percent of covered expenses if the trip is canceled “for any reason not otherwise covered by this policy,” the lawsuit relays.

In March 2020, however, Pennsylvania Governor Tom Wolf began issuing a series of executive orders in response to the COVID-19 pandemic that essentially barred the plaintiffs from traveling and subjected them to a quarantine the lawsuit argues falls “within the meaning of the Policy and of the everyday use of the word.”

While the orders were in place—and in direct response to safety concerns and government orders regarding the pandemic—AffordableTours.com, from whom the plaintiffs purchased their vacation, canceled the Europe trip, the case says.

Though each plaintiff submitted a claim to Arch for reimbursement of their unused, non-refundable prepaid payments and deposits, the defendants denied both claims, stating around June 23 that the companies “have determined that we are unable to approve your claim or to provide any benefits under your claim,” according to the suit.

The plaintiffs suspect the companies have denied all claims submitted by their insureds for expenses related to COVID-19-linked trip cancellations “on a uniform basis” and in a breach of their insurance policies.

The lawsuit looks to cover anyone who purchased or obtained an Individual Travel Protection Policy from the defendants and whose claim for reimbursement was denied after their trip was canceled due to the COVID-19 pandemic or COVID-19-related government orders, proclamations, and/or guidance.

ClassAction.org’s coverage of COVID-19 litigation can be found here and over on our Newswire.

Sign up for ClassAction.org’s newsletter here.