Ralph Lauren Corp. has filed suit against Factory Mutual Insurance Co. charging the insurer has tried to “wrongfully shoehorn” its claim for COVID-19 coverage into a  “narrow and limited grant of coverage” under its all risks policy, when its policy should provide much broader coverage.

New York-based Ralph Lauren’s policy, which provides $700 million in coverage, includes  a “communicable disease response” coverage that provides for the “cleanup, removal and disposal of…communicable diseases from insured property,” according to the lawsuit filed Friday in U.S. District Court in Newark in Ralph Lauren Corp. v. Factory Mutual Insurance Co. 

The communicable disease coverage has a $1 million sublimit, according to an exhibit to the complaint.

The complaint states “Because the policy specifically covers remediation of the damage caused by communicable disease, the physical damage to property caused by communicable disease is ‘physical damage of the type insured’ under the policy.”

In addition to triggering the policy’s all risks coverage, the company’s claim also triggers multiple other coverages under the policy, including “other additional coverages,” “time element coverages” and “time element coverage extensions,” according to the complaint.

The clothing manufacturer states sales at its brick-and-mortar stores fell 77% during the first quarter of 2020, while wholesale sales dropped 93% from the same period of the previous year.

“Aware that the policy and others like it afford coverage for COVID-19 losses beyond the on-site sublimited communicable disease coverage, FMC devised a plan designed to steer its policyholders including Ralph Lauren Corp. into at most, the on-site sublimited communicable disease coverages for their COVID-19 loss,” the complaint states.

The complaint states that “talking points” provided to FMIC claim adjusters “coach the adjuster to suggestively steer the policyholder toward the on-site communicable disease coverage, which provides only a fraction of the coverage limits otherwise available under the policy.”

The complaint charges FMC with breach of contract and violation of the New Jersey Consumer Fraud Act.

The Johnston, Rhode Island-based insurer said in a statement it is “unable to discuss the topic in the news media because of the legal nature of the matter.”

Insurers last week scored their third straight victory in cases involving COVID-19 business interruption claims when a District of Columbia judge ruled that the forced closure of a dozen restaurants in Washington did not constitute a direct physical loss.

More insurance and risk management news on the coronavirus crisis here.