Creative Artists Agency is suing an insurance carrier for allegedly breaching a contract to pay the talent and sports agency for all but one portion of its business losses sustained during the coronavirus pandemic.

CAA brought the suit Friday against Affiliated FM Insurance Co., seeking unspecified damages and a court declaration that the insurer is obligated to cover all of the plaintiff’s losses beyond those for communicable disease coverage, which the defendant has “potentially” agreed to pay, but are subject to aggregate sub-limits of $100,000, according to the suit.

An AFM representative could not be immediately reached for comment.

The language of the AFM policies is clear that the company provides broad all-risk coverage for CAA, including the agency’s real and personal property and economic losses resulting from direct physical loss or damage to property, with no exclusions for losses due to viruses or bacteria, the suit states.

CAA was assured by AFM that it had protection because the plaintiff bought high-level insurance from AFM to protect itself from an unprecedented and unanticipated catastrophe like the COVID-19 pandemic, the suit states.

Due to the pandemic and resulting government orders, CAA’s operations were significantly disrupted, including the use of its premises and those within CAA’s supply chain, the suit states. The disruption of CAA’s operations caused and continues to bring about substantial financial damage to the agency, including lost profits, revenue and business opportunities, according to the suit.

CAA also has suffered losses from canceled live events, including sporting events and concerts, as well as canceled television and motion picture productions, the suit states.

AFM “wrongfully has taken the position that the only coverage potentially available under the AFM policies for CAA’s pandemic-related property and business interruption losses is found in the policies (for) communicable disease coverages, both of which are subject to aggregate sub-limits of $100,000,” the suit states. Those amounts cover a small fraction of the losses CAA has experienced from the coronavirus and are less than the premium CAA paid during each of the policy periods, according to the suit.

AFM further has wrongfully concluded that CAA has not suffered direct physical loss or damage to property that would trigger coverage for business interruption losses, the suit states.

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