Are You Covered? Business Interruption Insurance During COVID-19

All businesses have been impacted, in one form or another, by COVID-19 and the ensuing social and government measures to combat the pandemic. For many, the most significant impact has been the immediate and sustained decline in revenue resulting from a drop off in business activity.

While government-issued orders regarding closure of non-essential businesses are vital public health measures, those affected businesses aren’t going to be “non-essential” to the owner/operator.  For them, this loss of revenue can be devastating to their continued existence. Most businesses have some kind of general insurance for their organization, mainly liability insurance, but it is also common for some policies to cover business losses as a result of interrupted business. The most common business interruptions covered in insurance policies are those as a result of fire, flood or sometimes earthquake -but some policies also cover business losses resulting from “outbreak”, “disease” or “epidemic”

The KEY question is what does YOUR policy say? Insurance policies are rarely “standard form” policies.  While many cover similar ground, the policies from the same insurance company might provide coverage for different things, or define different terms like “damage” or “loss” or “occurrence” or “accident” differently -insurance policies are complex documents.  As a general overview, they usually start out by stating what losses or perils are covered, followed by exceptions from that coverage, followed by exceptions to the exclusions (which might even put the original coverage back in!). The language of every policy must be examined carefully to see the extent of coverage.

Given the stakes, we recommend you seek professional advice regarding your insurance coverage. To connect with our team and learn how we can help with the insurance review process, click here.