Insurer Says COVID-19 is not ‘Pollution Condition’ in Bid to Dismiss Resort’s Lawsuit

PHOENIX — Illinois Union Insurance Co. has moved to dismiss a Lake Havasu, Ariz., resort’s lawsuit demanding coverage for $2 million in losses it allegedly sustained when it closed due to the COVID-19 pandemic and related civil authority orders.

In a July 2 motion to dismiss, the insurer contends that London Bridge Resort LLC is not entitled to coverage under the policy’s provision for “first-party claims” arising from a “pollution condition” because COVID-19 does not constitute a “pollution condition.”

“The term ‘pollution condition,’ as defined by the policy, is limited to traditional environmental pollution, and does not include a communicable …