Lawsuits filed against insurance companies over business losses stemming from the COVID-19 pandemic have jumped to the appellate courts, with the highest courts in three states, and at least two federal circuits, set to take up the matter soon.

Nearly 1,700 lawsuits have been filed by businesses against their insurers, which denied claims for business interruption coverage submitted after state and local government officials ordered lockdowns throughout the country last year. Most judges, particularly in federal courts, have sided with the insurers, which have insisted that COVID-19 did not result in a physical loss or damage to their properties, as required under the policies. But some courts have sided with policyholders, leaving businesses a window of opportunity to pursue the claims farther.