In light of the COVID-19 pandemic, Caesars indicated that it lost more than $2 billion. Despite paying all-risk insurance policies, the company said that none of its insurers covered any losses. Consequently, Caesars filed a lawsuit with the U.S. Securities and Exchange Commission on Monday this week.
The COVID-19 Pandemic Led to More Than $2 Billion in Losses for Caesars
Caesars Entertainment, the leading betting and gaming firm, filed a lawsuit against its insurers. The company seeks to recover more than $2 billion in losses due to the COVID-19 pandemic. The initial lawsuit was filed with the Clark County District Court in Las Vegas, Nevada on Friday. However, Caesars released more details in its filing with the U.S. Securities and Exchange Commission, dated Monday, March 22.
In its lawsuit, Caesars acknowledged that the COVID-19 pandemic has resulted in significant losses and disruption of business. As noted, the company estimated its losses to more than $2 billion. Furthermore, the company said that those losses are continuing.
Insurers Failed to Pay the Operator
The insurance policies which the company signed covered “all-risk”, except for those “explicitly limited or excluded by the terms of the policy”. However, Caesars stressed that although the “vast majority” of the policies did not exclude “loss or damage caused by a virus or pandemic“, the insurers have not paid the company for such losses.
As a part of its complaint, Caesars acknowledged that the COVID-19 pandemic and the virus spread has “ravaged every aspect of the economy“. Furthermore, the company stressed that perhaps no other sector or city was hit harder than the gaming and hospitality industry in Las Vegas.
Additionally, Caesars revealed that it paid more than $25 million in premium insurance policies to ensure a top-of-the-line, all-risk policy portfolio with an excessive of $3.4 billion in coverage limits. Despite those payments, the company said that the insurers have “failed to pay a single penny” for the business interruptions caused by the COVID-19 spread.