Insurance and Coronavirus COVID-19

March 12, 2020

A few thoughts on coronavirus and insurance from JoAnn:

The strain of coronavirus in the news, COVID-19, is causing alot of trepidation across the world, and to those here at home.  What if you had a business that was affected because of coronavirus and you saw a substantial decrease in revenue?  Is there coverage under business interruption/loss of business income?  What if you had an employee that contracted coronavirus on-the-job, would work comp respond?  What if you had a supplier that could not provide the goods you need to your business because of coronavirus, would contingent business income be triggered?  What if your business had to close because of a government order, would civil authority coverage apply?  

Every policy is different, particularly among industries and carriers.  While in the abstract it may seem like coverage could apply, it depends on the specific policy language and the specific details of the claim or loss submitted to the insurance provider from the insured (or agent on their behalf).  Things like what constitutes a "direct physical loss" for business interruption coverage?  Is there a virus or bacteria exclusion on the policy?  Are there some other endorsements or exclusions contained within a policy that could determine (or take away) coverage?  Many carriers are discussing coronavirus and how to respond to potential claims, but it can be certain that there is litigation coming.  With litigation will come policy clarification for future cases, and eventually insurance carrier policy form changes.

There is alot of speculation around how coverage would apply to coronavirus COVID-19, and it is impossible to answer hypotheticals.  If there is a specific claim that needs to be filed, or if your business has suffered a specific loss, please discuss the circumstances with your insurance agent and insurance carrier for guidance.  It may be that you should submit the claim to the carrier no matter what, because if the claim is denied that may help facilitate government assistance should you need it.

This is good time to make sure your safety protocols are being followed, and you have a safety manual in place.

For more information on insurance and coronavirus, please visit Insurance Journal.