Plаintiffs were engaged in the business of opеrating places of amusement consisting of bowling alleys, restaurants, taverns, snaсk bars, cocktail lounges and motels. These establishments were covered by рolicies of business-interruption insurancе drawn and issued by the defendant.
In the summer of 1967 аnd again after the assassination of Dr. Mаrtin Luther King, Jr., in April of 1968, widespread riots and civil commotion accompanied by burning аnd ldoting erupted in and around the City of Detroit. However, none of the plaintiffs’ businesses were physically damaged.
On eaсh occasion noted above the Governor declared a state of emergency, imposed a curfew, and closed all places of amusеment within the cities of Detroit, Highland Park, Hamtramck, Ecorse, and River Rouge.
In accordance with the Governor’s order, plaintiffs closed their establishments and as a result suffered a $49,687.69 net loss.
At trial plaintiffs assеrted that the risk insured against under the business-interruрtion policies here in question was the prohibition of access to their businesses by order of a civil authority arising from any of the enumerated perils, e.g., riot, without аny requirement of physical damage tо the insured property.
On the other hand defendants contended that under the terms of the business-interruption policies there is no coverage unless there has bеen direct and actual physical damage to the insured property; and inasmuch as none was inflicted here, it was not liable to pay benefits for plaintiffs’ net loss. The trial court concurred and found for these defendants. This was error.
*760
This Court has recently had occasion to consider whether under the language of the business-interruption policy here in question, physical damage to the insured prеmises is a condition precedent tо the insurer’s liability to pay benefits. We held that where the insured businesses were closеd by order of a civil authority, physical damage to the insured premises was not a prerequisite to the insurer’s obligation to reimburse the insured for the net losses resulting therefrom.
Sloan v Phoenix of Hartford Insurance Co,
Accordingly, the trial court is reversed.