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MAMA JO’S INC. V. SPARTA INSURANCE CO.: “DIRECT PHYSICAL LOSS” REQUIREMENT IN INSURANCE POLICIES RESTRICTS CLEANING AND BUSINESS INCOME LOSS CLAIMS

Terra Silva *

Photo Credit: https://perma.cc/RCM9-65GR

In Mama Jo’s Inc. v. Sparta Insurance Co., the United States Court of Appeals for the Eleventh Circuit held that an insurer properly denied coverage for a restaurant’s cleaning and business interruption claims because neither claim satisfied the policy’s “direct physical loss” requirement. The Mama Jo’s decision may be used by insurance companies arguing that denial of claims was proper based on the lack of any “direct physical loss,” as required by many policies. Though pandemic-related case law is still developing, Mama Jo’s may have major impacts on the outcome of such litigation.