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The insured suffered a loss due to a partial collapse of the roof. The insured is a nonprofit cultural center made up of members. Since the loss, monthly membership dues have dropped significantly as members have not had access to the club due to the loss.

The insured's policy includes the following definition of “Accounts Receivable”:

2. “Accounts Receivable” means:

a. All amounts due from your customers that you are unable to collect;

b. Interest charges on any loan required to offset amounts you are unable to collect pending our payment of these amounts;

c. Collection expenses in excess of your normal collection expenses that are made necessary by loss or damage; and

d. Other reasonable expenses that you incur to re-establish your records of “accounts receivable” that result from direct physical loss or damage by any Covered Cause of Loss to your records of “accounts receivable”.

“Accounts receivable” does not include “electronic data”.

It is our opinion that the lost dues are covered under accounts receivable. The insurance company is declining coverage.

We'd appreciate your opinion on this matter.

Connecticut Subscriber

The significant drop in dues being paid does not appear to fit in this definition of “accounts receivable” unless the members are required to pay even though the club is not available to them, and they are now in a collections situation. If that is not the case, then this coverage would not apply.

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