Pandemic ‘not a catastrophe’ – court rules against Star’s insurance appeal
Australian gambling and entertainment heavyweight Star has lost an appeal against a decision denying it compensation by its insurer for losses suffered during the coronavirus pandemic.
Star Entertainment's resort and casino on the Gold Coast. (File image).
Star Entertainment Group – which runs casinos in Sydney, Brisbane, and the Gold Coast as well as associated hotel, food and retail businesses at various sites – sued Chubb Insurance Australia and other insurers involved in the Star policy.
In the Federal Court in August, Chief Justice James Allsop dismissed Star’s claim for indemnity concluding Covid-19 is not a “catastrophe” within the meaning of the policy.
In a judgment handed down by the full Federal Court on Monday, which also addressed five other test cases concerning insurance for Covid-19 losses, Star’s arguments were again dismissed.
All six applicants had claimed they were owed indemnity for business interruption losses caused by Covid-19 restrictions – particularly concerning domestic and international travel – put in place by the government in 2020.
It also related to restrictions on movement and congregation of people in Australia, including the closure of the various premises on government orders.
Star’s policy provided cover up to $4 billion, and the gambling giant cited a section of the policy saying coverage included “loss resulting from or caused by any lawfully constituted authority in connection with or for the purpose of retarding any conflagration or other catastrophe”.
The pandemic fits into the “other catastrophe” category, they said.
However, another clause in the policy – addressing losses caused by notifiable diseases – expressly excluded diseases listed under the Commonwealth’s Biosecurity Act from the policy’s coverage.
“Covid-19 is such a disease,” Justice Mark Moshinsky said.
The full court was not persuaded by Star’s argument the pandemic was a “catastrophe” included by the policy, and even if it had been, the clause excluding Covid-19 would overrule that, he said.
Star’s appeal was dismissed, and the group was ordered to pay the legal costs of Chubb Insurance Australia.
The appeals by LCA Marrickville, Meridian Travel, the Taphouse Townsville, Market Foods and the liquidator of Educational World Travel were all unsuccessful also.
