Policyholder Attorneys See California Smoke Case as Boon for LA

Christine Haskett’s commentary was included in a Law360 article on the how businesses may benefit from a California federal court decision that likened smoke to asbestos, while differentiating smoke from viruses for insurance coverage purposes.

"If the California statutes provide minimum requirements for fire insurance and then the courts have said that includes smoke damage, I think it would be a severe uphill battle in the business interruption context for an insurer to argue smoke damage is not physical loss or damage," Christine told Law360. "The question becomes: Well what's the remedy for it? And that is often where the rubber meets the road," she added.

Remediation for smoke damage can be extensive on account of the toxins in smoke and the way those toxins can embed in building materials, she said. Christine further explained that insurers often argue that chemicals in smoke already exist in the environment — in small quantities in everyday air, for example — necessitating less coverage for remediation.