Businesses all across the United States are suffering as they are forced to assess their current and future losses due to COVID-19. The virus is quickly raising a number of questions for both small and large businesses as their future is uncertain.
Will business insurance be enough to cover some of these losses?
Business Interruption Insurance
This kind of insurance coverage is meant to compensate for lost income during the time that is needed to repair any physical damage to the building or property. This means that this coverage is often limited to only physical damage and does not compensate for anything that falls outside of those guidelines.
Civil Authority Coverage
Since the government has been placing certain restrictions on companies, a business may be able to recover some of its losses under the Civil Authority Coverage Clause. However, even with this clause, you will find that there is still something about physical damage being a requirement to a nearby property.
Contingent Property Insurance
This is also widely known as supply chain coverage. Using this kind of coverage depends on the threat of COVID-19 to the business as well as its presence in the business. These threats can be considered property damage and may fulfill the property damage requirement in some cases.
Infectious Disease Coverage
The other insurance coverage options are definitely a stretch for businesses that are experiencing loss due to the presence of COVID-19. For this reason, they may find some relief under infectious disease coverage. We currently cannot predict the extent of the damage caused by the virus or the overall threat of contamination that will end up triggering this kind of coverage for a business.
However, it may be fair to assume that several insurance providers for these businesses will be opposed to coverage for anything COVID-19 related. It is also possible that these losses will instead be addressed on the state level. There is always going to be an argument to whether contamination constitutes the appropriate level of physical damage that some of these above insurance coverages require.
So, what can a business do in the meantime?
If you are a restaurant business that can only currently do takeout and delivery, you need to reassure your customers that steps are being taken to ensure the cleanliness and sanitation of those services. For them to continue to visit your establishment and to help you mitigate some of your loss, the customers need to feel safe and reassured.
Keep Up with the News
Keeping up with the news and staying informed is also important during this time. Regulations and restrictions can change quickly, and there is information coming from both a state and federal level. Always ensure that your business continues to remain compliant.
Finally, as a business, it is important to review all policies and coverage to see what you can expect. Familiarize yourself with the coverage options that are currently in place. If you have other questions or need assistance with your business insurance policies, contact the experts at Panorama today for more information.