Schleicher and Stebbins Hotels LLC et al. v. Starr Surplus Lines Insurance Co. et al.

A New Hampshire Superior Court partially granted a local hotel company’s motion for summary judgment when it ruled that the presence of the COVID-19 virus on their premises would constitute direct physical loss. Judge John C. Kissinger reached this conclusion by interpreting a New Hampshire Supreme Court case. The case, Mellin v. Northern Security Insurance Co., holds that physical loss requires does not require structural damage, but only a showing of a distinct and demonstrable alteration of the property. The Superior Court reasoned that contamination of the property by the COVID-19 virus would make the property “distinct” from an uncontaminated property and that the inherent risk to human health a contaminated property poses is sufficient to constitute direct physical loss to the property.