Business Not Covered For Interruption Of Commerce Because Of Wild Fire

A Deadwood, South Dakota business was not covered under a business interruption policy for a reduction in commerce related to an evacuation order triggered by a range fire, the U.S. District Court for the District of South Dakota ruled. The case is By Development, Inc. v. United Fire & Casualty Co., 2006 WL 694991 (March 14, 2006). The governor of South Dakota ordered an evacuation of the town because of the fire. About 50 hours later, the order was lifted. The business, a hotel/casino, was able to re-open, but because some roads in the area were still blocked, it suffered a loss of customers.
One term of the policy granted coverage if civil authorities were to “prohibit access” to the business location, and the coverage would begin after 72 hours. The court held that, because only some roads were closed for as long as 72 hours, access was not totally denied, and granted summary judgment for the insurer.

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