Department Store Blames Insurers As It Files Bankruptcy and Shuts Down

By Jeremy Hill | September 10, 2020

Century 21 Stores, an iconic New York off-price department store chain, filed for bankruptcy with plans to shut down, becoming the latest victim of the retail industry carnage that’s accelerated during the pandemic.

The retailer will hold going out of business sales at its 13 stores in New York, New Jersey, Pennsylvania and Florida, according to a company statement. The company listed assets and liabilities of as much as $500 million each in its bankruptcy petition filed Thursday.

The company had “no viable alternative” to shutting down after its insurance providers failed to pay some $175 million Century 21 claims it’s owed under business interruption policies, Co-Chief Executive Officer Raymond Gindi said in the statement.

The insurance companies “turned their backs on us at this most critical time,” Gindi said. “While retailers across the board have suffered greatly due to Covid-19, and Century 21 is no exception, we are confident that had we received any meaningful portion of the insurance proceeds, we would have been able to save thousands of jobs and weather the storm.”

Disputes over business interruption insurance have been landing in court in droves, with insurers contending that pandemics aren’t covered. More than 1,100 insurance lawsuits tied to Covid-19 have been filed nationwide, according to data compiled by law firm Hunton Andrews Kurth.

Century 21 has sued several of its insurance providers over the failure to pay, the company said. It’ll move that lawsuit into bankruptcy court and seek a speedy adjudication, according to the statement.

The bankruptcy case is Century 21 Department Stores LLC, 20-12097, U.S. Bankruptcy Court for the Southern District of New York (Manhattan).

Photo: A general view of a Century 21 department store sign as photographed on March 20, 2020 in Westbury, New York. (Photo by Bruce Bennett/Getty Images)

Was this article valuable?

Here are more articles you may enjoy.

Latest Comments

  • September 16, 2020 at 2:12 pm
    mccluney says:
    Hey Ray: Gee, I consider myself to be a good insurance agent. But i never considered once explaining to any of my clients that pandemic causes of loss would not be covered by... read more
  • September 15, 2020 at 1:54 pm
    FFA says:
    I just watched the Blues Brothers movie. Jim Belishui has some good excuses for missing his wedding. .
  • September 11, 2020 at 1:54 pm
    An Actuary says:
    BLAME IT ON THE RAIN Milli Vanilli You said you didn't need her You told her good-bye (good-bye) You sacrificed a good love To satisfy your pride Now you wished That you shoul... read more

Add a CommentSee All Comments (4)Add a Comment

Your email address will not be published. Required fields are marked *

*

More News
More News Features