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Liability Claims
2021: The Year of Liability Claims

Pandemic-related claims and complaints are expected to keep insurers and courts particularly busy into the new year.
  • Ed Burtnette
  • January 2021
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As COVID-19 continues to spread throughout the United States this winter, the number of liability claims is expected to increase, reversing the downward trend seen in 2020.

Liability claims will probably have the largest impact on claim counts at the end of 2021, persisting into 2022.

Although 2020 numbers have yet to be finalized, we estimate that liability claims will decline by more than 50%. No doubt a part of that decline can be attributed to mitigation strategies adopted by employers and carriers in the wake of COVID-19, but the bigger factor may well be the lower level of economic activity in general. As the economy slides downward, so typically do liability claims.

An example of the pandemic impacting specific types of claims is the frequency of auto collisions and bodily injury incidents, which declined during the first surge of the pandemic. However, the severity of these claims increased. With less traffic on the road, the average speed of vehicles increased; when an accident occurred, it was likely to be more serious due to vehicle speed.

Legal actions, which often accompany liability claims, also have been impeded because of the pandemic's impact on state, local and federal courts. We anticipate that an ever-growing backlog of liability claims, as well as increased litigation, will continue to develop during 2021.

Unless Congress adopts liability protection legislation, the pandemic will continue to expose employers to significant liability risks.


In contrast to a decline in total liability claims during 2020, liability complaints and lawsuits related to COVID-19 increased. Although figures remain estimates, COVID liability legal actions last year exceeded 6,000 complaints (court filings and administrative complaints), according to COVID-19 Complaint Tracker compiled by Cognicion for the law firm Hunton Andrews Kurth.

Significant legal pitfalls involving claims continue to emerge. “Presumption” is a major example. There have been important disputes about whether, because of the nature of their work and accompanying potential exposure, COVID-positive employees are “presumed” to have contracted the virus while on the job. This most often affects first responders, essential workers and retail industries.

Last year, the largest group of COVID legal actions were against insurance companies surrounding business interruption coverage. In 2020, according to figures from COVID Coverage Litigation Tracker by the University of Pennsylvania Law School, more than 1,200 business interruption cases were filed. In most cases, courts have upheld policy exclusions for pandemic and virus coverage.

There are at least three important legal issues that will confront employers and the insurance industry in 2021: vaccines, federal and state liability protection issues, and additional presumption legislation.

The good news is that in the wake of the swine flu, Congress passed the Public Readiness and Emergency Preparedness Act of 2005, which provides liability protection to the developers, distributors and administrators of a pandemic vaccine. In May of 2020, the secretary of Health and Human Services triggered the provisions of the law when he signed a declaration that a public health emergency exists for the COVID-19 pandemic.

In September, Rand Corp., in an analysis of product liability for COVID-19 vaccines under federal law, commented: “There should be few concerns on the part of manufacturers, distributors and others regarding the possibility of being sued in an American courtroom for claims related to personal injuries or deaths arising from producing or administering COVID-19 vaccines when they finally become available.”

This past July the Safe to Work Act was introduced in the U.S. Senate. The act would provide liability relief for businesses, health care workers and facilities, educational institutions, local governments and more. However, the proposed legislation was referred to committee and no significant action had been taken during 2020.

“This legislation strikes the right balance between ensuring safe environments for workers, providing a liability shield for entities that follow government health guidelines, and preventing trial lawyers from taking advantage of the crisis and filing frivolous lawsuits,” said American Tort Reform Association (ATRA) President Sherman “Tiger” Joyce.

Federal employer-liability protection was a key part of the pandemic response legislation proposed in the U.S. Senate. Whether it will get the traction to be passed and signed into law by the president is unclear as of the publication of this article. But unless Congress adopts liability protection legislation, the pandemic will continue to expose employers to significant liability risks.

ATRA reports that 21 states enacted liability laws relating to COVID-19. Although provisions vary widely from state to state, the new laws protect employers and specific industries from COVID-19-related claims unless there is proof of gross negligence or wanton misconduct. The laws affect product liability (mostly personal protective devices), workers' compensation claims (with a focus on essential worker industries like health care and retail, nursing homes, and state and local governments), general liability claims, and premises liability claims.

ATRA also reports that 19 states issued executive or administrative orders in response to COVID-19 in 2020.

Many of these orders focused on issues related to presumption, in which employers such as hospitals, medical organizations, and other health care organizations hold presumptive liability because of the nature of their industries. It is expected that presumption legislation will continue to develop in 2021.

The National Council on Compensation Insurance (NCCI) reports that presumption legislation falls into three categories:

  • Bills that establish compensability presumptions for first responders and/or certain health care workers.
  • Bills that establish compensability presumptions for essential or frontline workers. These proposals cover other occupations that may be exposed to COVID-19, such as grocery store and pharmacy workers. Several of these proposals also are applicable to first responders and health care workers.
  • Bills that establish compensability presumptions for all employees in the state.

With the advent of COVID-19, we anticipate the use of liability waivers by businesses may become more common. Liability waivers generally can be effective for avoiding personal injury lawsuits and potential liability in connection with COVID-19 damages. However, liability waivers for pandemics—specifically for COVID-19 exposure, contraction and/or spread—have not been interpreted by the courts. These waivers may conflict with public policy and can be a challenge to enforce.

Even if the waivers do not provide complete protection, they can support businesses informing customers and suppliers of the risks associated with COVID-19. Many waivers, for example, cite the value of wearing a mask and engaging in social distancing to mitigate potential spread of the virus and accompanying liability. If waivers increase awareness and spur more use of protective measures such as masks and social distancing, liability will be indirectly reduced.

Still, defense firms report that dockets are full because the courts were slow to resolve earlier backlogs caused by restrictions imposed by the pandemic. It is only now that COVID cases are being heard, and delays will persist through 2021 and into 2022.

The system will struggle to handle the increasing caseloads at the same time it confronts difficulty in assembling jury pools. Individuals are avoiding jury duty because of COVID transmission risks. Exacerbating matters, jury pools often are made up of a larger percentage of seniors, who are at more risk from the virus.

We anticipate an increased use of remote juries and remote trials. Using Zoom, the first remote jury pool occurred last spring for a case in Collin County, Texas, involving a large property insurer and a conflict over coverage, according to the National Center for State Courts.

Since last spring, the most significant potential liability has often been associated with high-population facilities such as prisons, nursing homes and other health care facilities. We have seen superspreader events among large crowds—that can and should be controlled—such as night clubs, college campuses, religious services (including funerals), protest marches and political rallies.

As the virus continues to spread, we expect increasing liability claims related to these situations. Facilities and events can produce increased risk if state and local laws, for example, fail to require masks to be worn. We have seen wrongful death claims and class actions around these situations. State and local health departments may hold increasing liability if they fail to monitor safety guideline compliance for nursing homes, prisons and other superspreader conditions. Signed liability waivers are becoming more common at superspreader events, but their effectiveness remains a question.


Best’s Review contributor Ed Burtnette, CCLA, is vice president, Liability Services, for CorVel. He can be reached at bestreviewcomment@ambest.com.


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