June 21, 2021 3 min read


Mohegan Tribe Files Lawsuit against Insurer for Disputed Claims

Connecticut’s second tribal casino operator became the latest gaming company to file a multi-million lawsuit against an insurance company for failing to cover coronavirus-related damages to the business, Associated Press reported.

Following in the Footsteps of the Mashantucket Pequots

The operator of Mohegan Sun gaming property, the Mohegan Tribal Gaming Authority, initiated legal proceedings Friday against Factory Mutual Insurance Co, an insurer headquartered in Johnston, Road Island.

The complaint, filed in Connecticut’s Superior Court in New London, is similar to the one filed by the other federally recognized tribe in the state, the Mashantucket Pequots, against the same insurance company, after the operator of the Foxwoods Resort Casino in the state turned to the court in February to resolve its claim for an estimated $76 million in coronavirus-related losses.

Much like the Foxwoods, Mohegan Sun had to remain closed for about 11 weeks last year due to the outbreak of the virus which forced the business to shut down in March. During that period the gaming properties incurred losses which their respective operators believe should be covered by their insurance policies.

The Mashantucket case, pending resolution at Hartford Superior Court after being moved from New London Superior Court due to its complexity, is set to be addressed in a court hearing on August 2. Factory Mutual argues the disputed claims are not within the coverage of the $1.655 billion per occurrence insurance policy bought by the tribe.

Insurance Companies under Pressure

The Mohegan Tribal Gaming Authority became the latest gambling property operator to sue insurance companies for failing to adhere to their obligations under “all-risk” and “business disruption” insurance policies, with the highest-profile operator among them Caesars Entertainment.

In March, Caesars filed a lawsuit with the Clark County District Court in Las Vegas, Nevada, against a group of 60 insurance companies, including Allianz, Chubb, Aspen, and Lloyds of London, which refused to pay estimated damages from coronavirus-related disruptions to the business to the amount of $2 billion.

AIG Specialty Insurance Co was also sued by a gambling business, the owner of Circus Circus Phil Ruffin, but the District Court ruling dismissed the breach of contract. The ruling was immediately appealed against and is pending resolution, much like another lawsuit filed by another Ruffin’s property, Treasure Island, against Affiliated FM Insurance Co, which is pending in Las Vegas federal court.

“Most commercial insurance policies, including those with business interruption coverage, specifically exclude coverage for communicable diseases or viruses such as COVID-19 and have never covered viral exposures.”

American Property Casualty Insurance Association

According to a report published earlier this year in The Wall Street Journal, from an estimated 200 lawsuits filed for disputed coronavirus-related claims, insurance companies won some 80% and judging by the position of the association representing America’s insurance companies, the lawsuit filed by the tribe does not stand much of a chance either.

With the interest of the businesses in mind, several state legislatures are considering introducing legislation to ensure that in the future business interruption policies cover disease-related claims.

Lead Author

With 4 years experience as an analyst, Julie—or ‘Jewels’, as we aptly refer to her in the office—is nothing short of a marvel-worthy in her attention to the forex and cryptocurrency space as she quickly became the first pick to co-pilot education to the masses with Mike.

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