Due to the current pandemic, business owners need to understand what business insurance coverage is especially during COVID-19. While the main priority is to attempt to keep everyone safe during this time as a result of COVID-19, many business owners are also faced with the priority of remaining in business. With the shutdown or reduced hours of many businesses, and with people being advised to stay home and self-quarantine, business owners are most likely going to incur unprecedented losses.
The loss of income stemming from closures, supply chain disruptions and individuals’ curtailment of their ordinary activities will induce businesses of all sizes to seek insurance coverage through the business interruption provisions common to commercial property insurance.
What we recommend for business owners
During this time, all business-owners should conduct a review of their insurance policies for potential coverage. Depending upon the applicable policy language, there may be coverage available for loss of business income and extra expenses, either through coverages pertaining to civil authority, dependent properties, or physical damage to property.
Different types of coverage
Civil authority coverage may apply if a federal, state or local government agency issues a mandate directly affecting your business. For example, the restaurants and bars who have been ordered to shut down by a government agency may qualify for civil authority coverage.
There is also a coverage called dependent properties coverage. This coverage applies when there is covered damage to one of your client’s or supplier’s properties, which in turn prohibits you from conducting business. For example, many courthouses are closed, and as a result, suppliers to those courthouses are unable to conduct business with those courthouses and may qualify for dependent properties coverage.
Additionally, if your business or property suffers a direct physical loss, such as the contamination or potential contamination as a result of COVID-19, you may be eligible for insurance coverage. This coverage can provide benefits for loss of business income, extra expenses, and mitigation of the physical damage.
How can we help
It is important for an analysis to be conducted as soon as possible to determine if any of these coverages are available. As a law firm that specializes in insurance coverage matters, please feel free to give us a call for a no-cost consultation to determine the best course of action for you to take.