Do You Have a Coronavirus Business Interruption Claim?
The Coronavirus continues to wreak havoc on the economy since the government has ordered business such as restaurants, coffee shops, hotels and retailers to close their doors to the public. Financial loss of this pandemic continues to rise. If you’re a business owner, can you recoup losses from your insurance policy? How do you know if you have a legitimate Coronavirus business interruption claim?
What is a Business Interruption Claim?
Before anything else is considered, business owners must be able to determine if they, in fact, have a real business interruption claim. To do that, the following questions must first be considered:
Did a covered peril cause direct physical damage or physical loss to the insured property?
Did the damage or loss occur during the policy period?
Did the damage result in an actual loss of business income due to the necessary suspension of the business?
There’s a lot of debate within the insurance industry (and lawyers) about how insurance policies are defining terms such as “damage,” “loss” and “harm” as it relates to COVID-19. The result of this debate has caused some insurance companies to deny Coronavirus business interruption claims.
Does this mean that all insurance claims for business interruption, loss of use, extended coverage, continuing coverage and/or extra expenses will be denied? Only time will tell. Based on what we know now, if someone at your place of business has or had Coronavirus and you were forced to close, then THAT might trigger a plausible claim. In addition to that, if you currently have a difference in conditions policy (DIC), then your insurance claim might have a clearer path forward.
There’s one thing that our fifty years as public adjusters has taught us. Denied claims shouldn’t be given up on. Our public adjusters and business interruption experts have overturned thousands of claims that were previously denied or underpaid. Additionally, case law is ever-changing and can affect the outcome of claims.
This is new territory for everyone. Adjusters and insurance companies have never dealt with business interruption losses resulting from a pandemic. Because of that, we encourage business owners to be proactive. Although the situation appears bleak at the moment, continue to move forward with a plan.
Tips to Potentially File a Coronavirus Business Interruption Claim
Contact your insurance agent or insurance company. Request a certified copy of your entire insurance policy and riders, if any.
Document everything. Create a daily working diary of all your expenses and losses. Save receipts. Be sure to include everything. In addition, if you’ve contacted your insurance company then document the dates and times of the conversations and a brief recap.
Gather copies of the previous three years’ tax returns, profit and loss statements, lease agreements and inventories