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School District Insurance May Not Cover COVID-19 Claims

Board Governance Coronavirus

We understand that at least one school district insurance cooperative has informed its member school districts that the liability coverage carried by the cooperative excludes coverage for liability claims related to COVID-19. Therefore, according to the cooperative, if an individual sued a school district for a COVID-19 health-related claim, the cooperative would not pay for the defense of that claim. Instead, the school district would be solely responsible for paying such costs as well as the cost of any settlement or damage award by a court.

While this is only one cooperative, according to its communication to clients, the COVID-19 exclusion is becoming more common among liability insurers. We recommend that school districts reach out to their insurance consultants and providers to determine the scope of their coverage, if any, with respect to COVID-19 claims.

As we have advised in previous alerts, the Illinois Local Governmental and Governmental Employees Tort Immunity Act provides robust protections for school districts that may face injury or death claims related to COVID-19. This is especially true of school districts that implement and adhere to plans and policies that comply with Federal/State/Local statutes along with guidelines provided by the CDC, Public Health Departments, IHSA, and ISBE.

We continue to work with our school district clients on their COVID-19 resolutions, policies, and plans to facilitate enforceability and compatibility with Tort Immunity Act defenses. If liability insurance will not cover school districts for COVID-19 claims, then being positioned to take advantage of the Tort Immunity Act defenses takes on increased importance.