Submit Your COVID-19 Business Insurance Claims Early

As Covid-19 continues to have an unprecedented effect on business operations throughout the country, experts suggest business insurance policy holders should file their business interruption insurance and workers compensation claims for coronavirus as early as possible notwithstanding their concerns or exclusions. Although warnings from insurers indicate most of the claims stemming from the coronavirus could be denied due to policy exclusions, the final determination is left to the courts.

Currently, from the businesses that filed business interruption and workers compensation claims due to coronavirus, only 5% were declined. But time is everything and delays could hinder your ability to get covered. Keep in mind, past case law is limited when it comes to business interruption cases that involve total or partial closings such as a pandemic of such dimensions. So, the application of coverage will eventually be decided by judicial systems.

The availability of business insurance for pandemic losses remains uncertain in the future, it’s important that business leaders review their insurance policies and give notice of any possible claims as soon as they are able. Timely reporting is critical to preserving your rights.  Report directly to your insurer and in accordance with your policy terms.

Make sure you review your policy. Some terms to look for are, for instance, disease, virus, bacteria, fungi, infectious/communicable disease, pandemic, and contamination/contaminated. You should also read the declarations page of your policy. Concentrate on the amount of potential coverage, self-insured retentions or any deductible that must be satisfied prior to responding to the loss as well as the term of the policy. Also, if your policy is expiring any time soon, seek help from an insurance agent with experience in negotiating the renewal terms, especially those associated with the exclusions mentioned above.

If your company is facing the possibility of third -party claims, make sure you review the provisions of the policies relating to choice of counsel and defense costs. Defense costs may not be paid besides the liability limits included in the declarations. Most policies are “burning limits” so defense expenses are covered by the available limits. Also, most policies will require policy holders to use pre-approved counsel selected by the insurance carrier to defend third-party claims.  

Coverage will eventually depend on the facts of your claim and your policy language as well as relevant state laws.  Keep in mind, actions by federal and state authorities are constantly changing and they may sooner or later impact insurance coverage. Whatever you do, the sooner you claim your rights the better.

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