Insurance and Covid-19 usually come together in commercial insurance policies. The relevant part of a policy is usually referred to as “business interruption” coverage. This issue was recently discussed in an article published in the National Law Review. Here is a what a lot of what the article tells us. Keep in mind that each state and each policy will have its own ways of reading and enforcing these policies.
The impacts of the Covid-19 are far-reaching. Concern about lost revenue, liability for the health and welfare of workers, their family members, and customers remain top-of-mind for all businesses. As a result, many businesses have started to question whether they might have insurance coverage available to respond to this unprecedented situation. Although the analysis of any particular claim for insurance benefits will vary based on the specific language of insurance policies and the circumstances of each case, here is a summary of common insurance considerations in light of the Covid-19 pandemic.
As it relates to lost revenue many commercial property insurance policies provide coverage for financial losses due to business interruption suffered as a result of “direct physical loss or damage” to covered property (these are the most commonly used words in a policy) – often the business’s physical facility. If coverage is afforded, insurance may be available to cover lost net income and operating expenses while operations were suspended.