The landscape of decisions is varied, though many cases are still working their way through the courts. While policyholders have found some success, the majority of opinions thus far have favored insurers. From the outset, insurers have argued that COVID-19 does not cause “direct physical loss or damage” to property, so coverage cannot be triggered. Accepting the insurer’s argument, the Northern District of Texas recently held that “physical loss” does not include “intangible or incorporeal” losses, and an insured that merely suffers “a detrimental economic impact unaccompanied by a distinct, demonstrable, physical alteration of the property” has not suffered a “physical loss.” Graileys, Inc. v. Sentinel Insurance Co., Ltd. (August 2021). Coronavirus, the court concluded, “does not cause physical damage to property, it causes people to get sick.” Because the insured had not pleaded that it suffered any physical loss, the court held the insurer properly denied the insured’s claim, granting the insurer’s motion to dismiss. On the other hand, some courts have sided with policyholders. A federal court in Missouri read the “direct physical loss or damage” language in favor of the insured in Studio 417, Inc. v. Cincinnati Ins. Co. (August 2020). In response to Cincinnati’s motion to dismiss, the policyholders argued that the policy required direct physical loss or damage, and that there could be “physical loss” even if there was no damage, i.e., a physical alteration of property. The court held that “loss” meant “deprivation.” Because the plaintiffs alleged that the virus had attached itself to property—an allegation sure to be hotly contested throughout the case—the court concluded the plaintiffs had adequately pleaded a direct physical loss. Keep in mind that, as always, coverage will depend on the specific language of each policy and the circumstances of each loss. For example, many policies contain a “virus exclusion” that excludes coverage for losses caused by a “virus, bacteria or other microorganism that induces or is capable of inducing physical distress, illness or disease.” A federal court in Texas relied on such an exclusion to dismiss a group of policyholders’ COVID-related claims against their insurer in Diesel Barbershop, LLC v. State Farm Lloyds (August 2020). Other policies instead include the word “virus” within a “pollution exclusion” that bars coverage for losses caused by pollutants or contaminants many times defined to include