Florida Dentist Loses COVID-19 Insurance Suit

Author: Ross Dwyer

Guest Editors: Nathan Berkeley, Ashley Kaye

November 30, 2020 3:18pm

Tyson & Mendes has been tracking COVID-19 insurance lawsuits brought by businesses seeking to recoup losses from insurers related to the pandemic. Last month, we reported on a beer distributor who had its insurance coverage lawsuit dismissed by the United States District Court for the Middle District of Florida. This month, we report on a Florida dentist who suffered a similar result when Florida’s Southern District Court tossed his insurance coverage lawsuit against Hartford Casualty Insurance Company (“Hartford”).

The case is Raymond H Nahmad DDS PA v. Hartford Casualty Insurance Company (S.D. Fla., Nov. 2, 2020, No. 1:20-CV-22833) 2020 WL 6392841.


Raymond Nahmad, a dentist practicing in Miami-Dade County, sued Hartford after it denied his COVID-19 business loss claim. Dr. Nahmad sought to recover under his Hartford policy for losses sustained when his practice was suspended due to shutdown orders issued by the Governor of Florida and Mayor of Miami-Dade County in light of the COVID-19 pandemic. Nahmad, WL 6392841 at *1. Hartford denied his claim and Dr. Nahmad filed suit alleging breach of contract and declaratory relief. Id. Hartford successfully removed the litigation to United Stated District Court for the Southern District of Florida, where the matter was heard by Judge Beth Bloom. Id. Once removed, Hartford brought a motion to dismiss.

Coverage under the Hartford Policy

The Hartford policy at issue provided coverage to Dr. Nahmad’s practice for “direct physical loss of or physical damage to Covered Property” caused by a covered cause of loss. Id. at *3. The policy also provided some coverage for business losses sustained due to the necessary suspension of operations during a “period of restoration.” Id. For coverage to initiate, said business losses must be caused by direct physical loss of or physical damage to the covered property. Id. The Hartford policy contained an exclusion that refused coverage for any loss or damage caused directly or indirectly by fungi, wet rot, dry rot, bacteria, or virus. Id. at *4.

Analysis of the Court

In an attempt to defeat Hartford’s motion to dismiss, Dr. Nahmad argued the matter involved “dense factual issues” which needed to be developed. Id. at *5. The strategy backfired, as the Court agreed with Hartford in determining Dr. Nahmad failed to identify even “a single factual issue that needs to be developed.” Id. Working against Dr. Nahmad was Florida’s well-established legal precedent that an insured seeking to recover under an all-risks policy bears the burden of proving a covered loss occurred at the insured property. Berkower v. USAA Cas. Ins. Co. (S.D. Fla. Apr. 4, 2017). No. 15-23947-CIV, 2017 WL 1250419, at *7.

Dr. Nahmad argued he met his burden by sufficiently alleging the loss was caused by the governmental suspension orders and/or the COVID-19 pandemic, which he alleged were covered losses under the policy. Nahmad, WL 6392841 at *6. Dr. Nahmad further argued the loss of his business income constituted “a direct ‘physical loss’ and ‘physical damage’” because nonessential dental procedures were specifically suspended by the Governor. Id. In other words, Dr. Nahmad attempted to convince the Court economic damages, even without any corresponding physical harm to covered property, are covered under the Hartford policy. The Court was not persuaded.

Judge Bloom used Dr. Nahmad’s complaint against him, pointing out the complaint itself alleged there was no physical harm to the insured premises because plaintiff’s injuries are purely economic. Id. In support, Judge Bloom cited several recent Florida cases which found economic losses caused by COVID-19 business closures do not constitute a “direct physical loss” or “physical harm.” See e.g., Malaube, LLC v. Greenwich Insurance Company (S.D. Fla., Aug. 26, 2020, No. 20-22615-CIV) 2020 WL 5051581. Judge Bloom specifically noted Florida’s appellate courts are in agreement with this interpretation. Nahmad, WL 6392841 at *7.

Ultimately, the Court held coverage under the Hartford policy required “direct physical loss,” an unambiguous term that requires some form of actual, physical damage to the insured premises. Id. at *8. Dr. Nahmad simply did not make any such allegation in his complaint.

Judge Bloom also found that even if Dr. Nahmad was able to establish coverage for a “direct physical loss,” the Hartford policy’s mold/virus exclusion would ultimately apply to bar the claims being asserted. Id. at *9. Judge Bloom was not persuaded by Dr. Nahmad’s argument the virus exclusion did not apply because the actual cause of the loss stemmed from the shutdown orders. Judge Bloom noted the shutdown orders were specifically enacted to address COVID-19 activity. Id.

Accordingly, Judge Bloom ordered the entire complaint dismissed. Id. at *11. As additional support for the decision, Judge Bloom cited numerous other recent decisions from Florida and other states that dismissed similar COVID-19-related lawsuits for failing to plead actionable claims under the applicable insurance policy. Id. at *5.


Dr. Nahmad’s case was a bit of a longshot. Dr. Nahmad did not make any allegations of “direct physical loss” and was seeking to recover under a policy with an explicit virus exclusion. Longshot or not, we can now add this one to the growing list of COVID-19 insurance cases where a denial of coverage was ultimately endorsed by the courts.

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