Major League Baseball Sues Insurers for 2020 Losses

The coronavirus pandemic has cost teams billions in ticket revenue

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Ben Luthi
Ben Luthi
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Published December 14, 2020

Major League Baseball (MLB) has sued its insurance providers following billions of dollars in losses due to the coronavirus pandemic. The suit was initially filed in October but obtained on Dec. 4 by the Associated Press.

Key Takeaways

  • Major League Baseball and 30 teams are suing their insurance carriers, maintaining that they should be covered for losses resulting from the coronavirus pandemic.
  • Insurers named in the lawsuit include AIG, Factory Mutual, and Interstate Fire and Casualty Company.
  • The lawsuit says that the insurers have not paid out claims despite the fact that MLB purchased pricier all-risk policies.

Baseball During the Pandemic

Like other sports leagues, MLB was forced into a modified season, with games played mostly in empty stadiums, due to the coronavirus pandemic. Teams canceled a staggering 1,500 games, making the 2020 season the shortest on record. 

Limited numbers of fans were allowed to attend the National League Championship Series and the World Series in Arlington, Texas, but ticket sales were nowhere close to what the postseason takes in during a normal season.

MLB Alleges Breach of Contract

In the lawsuit, MLB says fans are the core driver of the league’s revenue and argues that the billions in losses should be covered by the broad policies purchased from the defendants. The lawsuit maintains that the insurers have not paid out claims, despite the fact that MLB purchased pricier all-risk policies.

The lawsuit has also alleges that the insurance companies have very publicly refused to make good on the contractual obligations of those policies. 

In addition to MLB, plaintiffs in the lawsuit include all 30 of the organization’s teams, the league’s digital and streaming services, MLB Network, and Tickets.com.

Insurers named in the suit include AIG, Factory Mutual, and Interstate Fire and Casualty Company.

This isn’t the first lawsuit in baseball as a result of the coronavirus pandemic. In June, 15 minor league baseball teams sued their insurance providers over business interruption claims. So far, at least one of the cases has been dismissed due to a virus exclusion in the team’s policy.

Article Sources
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  1. ESPN. "MLB Sues Insurance Providers, Cites Billions in Losses Related to COVD-19."

  2. Insurance Journal. "Minor League Baseball Teams Sue Insurers for Coronavirus Business Income Losses."

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