As businesses are being forced to shut down because of Coronavirus (COVID-19), many business owners are checking to see if their business insurance policy provides coverage for the mounting losses. These losses accumulate as soon as a business is shutdown. The most obvious loss comes from loss of revenue. Whether revenue is stopped completely, or reduced, business owners should look at all possibilities of recovery.

Most business owners purchase insurance for their business each year to protect it from certain losses. Many business owners don’t understand all the coverage included in the business policy. A business owner pays a premium to the insurance company in exchange for the insurance company agreeing to provide coverage for certain situations. Common examples include:

1. Fire: If a fire burns a business to the ground, business insurance should cover that loss, if the business paid a premium that included coverage for loss due to a fire; and
2. Tree: If a tree falls on a business and knocks the building down, insurance should cover that loss, if the business paid a premium that included coverage for loss due to a tree falling on the building.

An insurance company is supposed to help business owners when they suffer a loss. Although not common, an insurance company may deny a valid claim, basically sandbagging its insured (the business owner). When an insurance company denies a claim, the insured believes is covered, the insured may be forced to retain a lawyer to sue its own insurance company.

Business owners often purchase, “business interruption insurance” for situations when the business’ day to day activities are interrupted. Business interruption insurance may cover losses such as lost revenue. Many business owners will likely look to their insurance company to cover its financial losses due to the shutdown caused by Coronavirus (COVID-19).

Some insurance companies may deny the claim based on certain policy language. Each business owner has a different set of facts and losses related to Coronavirus (COVID-19). Likewise, each insurance policy will have specific language regarding business interruption insurance and the types of loss covered. It’s expected that some insurance companies will initially deny business interruption claims related to Coronavirus (COVID-19) because there is no physical damage to the building the business occupies. It’s common for a business to have multiple insurance policies for the same year. It’s important to have a business interruption insurance attorney review all the insurance policies for the business, since no two insurance policies are alike.

A business insurance policy may have specific language that provides insurance coverage to a business forced to close due to certain orders from the government. Recent orders from the government have forced many types of businesses to shutdown. Reviewing all of the business’ insurance policies is important to see if any policy includes coverage for situations like this. A business interruption insurance attorney can help you determine if a business is applicable.

Contact us today for a free consultation regarding your business interruption insurance questions.