COVID-19 has already caused severe disruption to the economy in every state, our nation, and the world. In the United States, government entities as well as the private sector are implementing more and more drastic measures to respond to COVID-19. While these efforts may be wise in light of the substantial public health concerns, they threaten to bring parts of the economy to a virtual halt, adversely impacting most every business and resulting in substantial losses.
These losses for businesses, coupled with having to fully close or halt nearly the vast majority of the scope of services they provide, are detrimental to the longevity of their operations. If there is an expectation that these events caused by COVID-19 would trigger their business interruption coverage, this might not be the case.
Insurance companies over nearly the past two decades have begun to quietly remove infectious diseases from the coverage, starting with the SARS epidemic in 2003, followed by the H1N1 virus in 2009.
Some states are aware of this, and are in the process of passing legislation to ensure that insurers pay businesses interruption claims during this pandemic.
While COVID-19 presents a unique and difficult situation for all of us, this presents a great opportunity to review your own business interruption coverage policy to fully understand your coverage and exceptions to such coverage.
We have created a response team to the rapidly changing COVID-19 situation, and will continue to post any new developments. You can view the page and additional resources by following the link here. In the meantime, if you have any questions, please contact your Fraser Trebilcock attorney.