Baylor medical school’s COVID coverage win overturned

A Texas appeals court Tuesday overturned a jury’s $12 million verdict in favor of Baylor College of Medicine in a COVID-19-related coverage dispute with insurers, saying there was insufficient evidence to prove the virus caused tangible physical damage.

A three-judge panel of the 14th Court of Appeals said in Lloyd’s Syndicate 1967 et al. v. Baylor College of Medicine that the majority of courts that have ruled in COVID-19 coverage disputes disagreed with policyholders that the virus can cause covered physical damage. The panel said it was “striving for uniformity with other jurisdictions that have applied identical or similar policy language.”

The Houston-based medical school sued Lloyd’s underwriters and other insurers that issued it “all risks” policies in Texas’ 295th District Court for Harris County in September 2020 after they denied coverage for business losses caused by the pandemic.

The jury found in September 2022 that the presence of the virus caused direct physical loss and damage to Baylor’s property, and the underwriters appealed.

Representatives for the parties did not respond to requests for comment.