The Australian casino operator The Star Entertainment Group has taken its insurance carrier to court after the company turned down a legitimate claim in accordance to the gambling firm’s insurance policy.
As a result, The Star Entertainment decided to bring the issue to court. The casino company claims that Chubb Insurance refused to pay for a claim submitted by the Australian gambling giant in the first quarter, with the claim being associated with the impact the coronavirus infection had on the company. The casino and entertainment services operator revealed that it had not been provided with a detailed explanation with the reasons why its claim was considered untenable and was not covered by the company’s insurance policy.
At the time it did so, the insurance company tried to solve the issue once and for all, which meant that the only option for The Star Entertainment was to take its insurer to the Federal Court.
According to the official statement that the casino operator filed in the Federal Court on August 21st, the company has continued to suffer some losses in terms of gross revenue and turnover reduction, as well as an increased cost of working. The legal claim was not quantified yet by the Australian gambling operator.
Coronavirus Lockdown Had Badly Affected The Star Entertainment’s Performance
In the middle of March 2020, The Star Entertainment was forced to shut down its retail operations, along with other gambling and entertainment businesses, as part of the New South Wales (NSW) Government’s efforts to prevent the further spread of the coronavirus infection.
The gaming and entertainment properties of The Star remained shut until the local Government allowed companies to resume operations in June, with certain social distancing measures and other restrictions in place. The beginning of July saw the gambling company remove some of the restrictions regarding its venues’ capacity but put new ones in their place by the end of the month.
In any case, the continuous lockdown because of the coronavirus pandemic has had a serious impact on the company’s operations. The Stars Entertainment claimed that its insurance policy covers risks of those lockdown restrictions associated with its business operations, saying that its business was interrupted by the closures, and the pandemic has been having a continuous effect interfering with its operations. The fact that the company was not able to access its premises and offer its services like it would normally do because of the entry restrictions were considered a reasonable claim. Unfortunately for the company, Chubb Insurance formally denied that claim on May 27th.
The first appearance of the two parties took place in Sydney’s Federal Court before Chief Justice James Allsop. The latter ordered the insurance company to file and serve a concise statement to respond to the claims made by The Star Entertainment. Chubb Insurance was also ordered by the Judge to make sure it fully identifies the basis for the denial of the gambling operator’s indemnity claim. The insurance company has until September 22nd to do that, while no date for a second appearance in court being set yet.