Washington Tribal Casino Wins COVID-19 Insurance Claim Lawsuit

Posted on: September 8, 2021, 09:49h. 

Last updated on: October 5, 2021, 10:15h.

A Washington tribal casino owned and operated by the Snoqualmie Indian Tribe can collect insurance money for damages and losses incurred by COVID-19. That’s according to Washington Superior Court Judge Catherine Shaffer, who ruled in favor of the tribe last week.

Washington tribal casino Snoqualmie
A large audience attends a music concert at the Snoqualmie Casino outdoor performance venue in July of 2019. The casino has won a court fight with its insurer that allows the tribal owner of the resort to recoup lost revenue caused by COVID-19. (Image: K5 NBC News)

A federally recognized Native American group, the Snoqualmie Tribe sought insurance compensation from their insurer — FM Global — for revenue losses sustained by the coronavirus pandemic.

FM Global and its Washington subsidiary Affiliated FM argued that because there was no physical loss or damage to the properties, the coverage available to the tribal casino was capped at $100,000. That was the amount that the casino’s insurance policy covered for operating losses related to “communicable disease.”

The tribe contended that its $150 million overall policy extended to COVID-19 because of the policy’s stipulating that the full coverage shields “all risks of physical loss or damage.” Judge Shaffer agreed and directed FB Global to communicate with the tribe to determine a compensation figure far higher than the issued $100,000 coverage amount.

The Snoqualmie people opened their Snoqualmie Casino in Snoqualmie, Wa., in 2008.

Major Victory for Tribe 

Commercial casinos were first ordered to shutter their resort and gaming operations during the earliest stages of the pandemic in March of 2020. Since then, lawsuits against insurers refusing to pay out on revenue losses have filled courts. Tribal casinos, which aren’t required to adhere to state orders, as they operate on their sovereign land under their own governments, voluntarily closed to assist in the pandemic response.

Tribes, like commercial casinos, sought insurance compensation. Courts have largely sided with the insurance companies. But there have been a few victories for casinos, the latest being the Snoqualmie Casino.

The Snoqualmie Casino is the closest gaming venue with slot machines and table games to Seattle. A roughly 30-minute drive from the city, the casino today houses 1,700 slot machines and 54 table games. The resort features several restaurants, a sportsbook, an outdoor concert venue, and meeting facilities.

In her judgment, Shaffer concluded that Affiliated FM’s business interruption insurance policy issued to the Snoqualmie Casino didn’t clearly explain that such a pandemic would not be covered.

Because the phrase ‘all risks of physical loss or damage’ is stated in this disjunctive, the term ‘physical loss’ must mean something other than ‘damage,'” she declared. “A reasonable interpretation of the phrase is that the tribe was deprived of the ability to physically use or operate its properties because of the COVID-19-related closures.”

Shaffer has ordered the tribe and insurance carrier to negotiate a settlement. FM Global did not immediately respond to the court outcome. But it could appeal the ruling.

Tribe Donates Money

The Snoqualmie Indian Tribe, a small Native American group with less than 1,000 members, was negatively impacted by COVID-19. But the virus hasn’t stopped the tribe from carrying on with its charitable endeavors.

Last month, the Snoqualmie Tribe distributed more than $650,000 to numerous nonprofits throughout the state of Washington. Tribal officials said the focus of this year’s donations were veterans’ programs, arts and culture organizations, Native services, family assistance, salmon habitat restoration and protection, and environmental education in the Snoqualmie Valley.