Business Interruption Insurance & COVID-19

The COVID-19 pandemic is evolving by the hour and businesses are rightly worried about the impact it will have on them. As business owners scramble to stay afloat, there’s a lot of misinformation being spread as to what they qualify for in terms of insurance coverage. Doug Ford and other officials have told business owners to talk to their insurance providers about business interruption coverage, but it’s not as simple as that.

Is Your Business Covered?

Business interruption insurance provides coverage when there is an insured peril that causes direct physical damage to the premises. Claiming business interruption is a lot more straightforward when something like a fire is involved. It becomes less clear in the case of COVID-19 as there is no specific clause relating to a pandemic or shutdown. 

Commercial insurance policies can vary dramatically from one another, with language that can be interpreted differently. As we’re now in a very unique circumstance, it’ll ultimately be up to your insurance provider on how they interpret your policy. Some policies may have unique coverage that’s relevant, such as supply chain breakdowns, but it’s ultimately up to your insurer.

Because of the potential magnitude of loss from COVID-19, it’s important to work with your financial team to document all losses and any efforts you’re taking to mitigate them. There’s no harm in presenting your case to your insurer and seeing what can be worked out.

Stay Up To Date On Government Programs

As previously mentioned, the COVID-19 situation is evolving by the hour. Business owners should stay up to date with any news relating to government programs they can take advantage of. These are unprecedented times that will put an unprecedented burden on businesses, but it will pass. Stay informed and stay safe.