Chef Hemant Bhagwani Sues His Insurance Company

Hemant Bhagwani

TORONTO — Veteran restaurateur and chef, Hemant Bhagwani, who is behind some of Toronto’s most beloved restaurants (Amaya Group, Goa Indian Farm Kitchen and Fat Rabbit) is suing his insurance company, Allianz Global Risks, for denying his insurance claim for business interruption during the COVID-19 pandemic. 

The suit is filed for the three businesses named above, but more are coming.

On March 17, 2020, the Government of Ontario declared a state of emergency and  ordered all bars and restaurants (with the exception of takeout and delivery services) to close, which led Bhagwani to file a claim for damages by way of lost profits, payroll expenses, loss of stock and punitive damages under his comprehensive all-risk insurance policy, which includes business interruption.

All three policies clearly state losses “sustained by the insured as a result of damaged caused by order of civil authority to retard or prevent a conflagration or other catastrophe” as well as a “loss of gross profits for a period of 12 months” and “ordinary payroll for 90 days.”  The policy is not subject to sublimits of insurance. 

The forced closure by the government thus triggered coverage under the policies issued by Allianz.

Bhagwani has paid more than $5 million in insurance premiums across his various restaurants and has not previously made any claims. Independent, small businesses such as his, take out insurance policies with business-interruption insurance precisely to weather the storm when unforeseen circumstances force them to cease operations. 

“These are unprecedented times, with all of us reeling from the impact of the pandemic,” says Bhagwani. “Everyone is trying to help, whether it’s the Federal Government or the landlords.  

However, the insurance companies are wrongfully denying claims. I refuse to accept this and am taking a stand, not just for myself and my franchisees, but also for other small-business owners who are in the same position.”

The pandemic, and subsequent physical-distancing measures imposed by the Government of Ontario to prevent the healthcare system from being overrun, has had a devastating impact on Ontario businesses, and the restaurant industry has been particularly hard hit. With no end date in sight, the fate of when restaurant dining-rooms can re-open and how long thereafter that physical-distancing measures remain in place remains unknown. The denial of claim adds to the devastating impact already being suffered by restaurants.

“I’m not looking for a handout,” says Bhagwani. “I just want to last until I can re-open my doors and rehire my staff.” 

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