Businesses all around the world have been deeply affected by COVID-19 pandemic. The U.S Travel Association has projected an $809 billion hit on the United States economy due to a decrease in travel and will eliminate a total of 4.6 million jobs.
The National Restaurant Association also estimates that within three months, U.S restaurants will lose $225 billion.
Social distancing and the closure of businesses may be important to preserve the health of citizens. However, these measures will consequently affect small and large businesses.
You may be able to receive help from your insurance company through your business interruption coverage to cover your losses. However, business interruption coverage and understanding the language of your insurance policy can be complicated.
In addition, insurance companies have been denying business owners the coverage to cover their losses. Learn how to handle denied business interruption claims so that you don’t fall victim to your insurance company’s denial.
COVID-19 Effect on Businesses
The coronavirus pandemic has devasted millions of businesses worldwide. Especially those businesses deemed “non-essential” have been left in the dust. Lockdowns threaten the existence of business owners and employees suddenly becoming unemployed lose their only source of income.
The United States Chamber of Commerce reports that approximately 24% of small businesses have been shut down and 40% expect to shut down their business in the coming weeks. Consequently, forty-three percent of business owners believe they have less than six months to save their businesses before shutting down. Furthermore, 56% of business owners believe that it will take the United States economy six months to a year to return back to normal. Many businesses simply do not have this kind of time.
Business Interruption Coverage
A national crisis and economic turmoil have business owners relying on their insurance policies to help pay for their losses. A business interruption coverage is meant to compensate business owners for lost income due to disasters, including expenses on:
- The lease or rent payments
- Relocation costs
- Loan payments
Challenges With Business Interruption Insurance Claims
Business owners across the nation have realized that receiving compensation from their insurance company has proven to be difficult. As a matter of fact, insurance companies have stated that the lockdown of businesses due to the pandemic is not covered by the business interruption insurance coverage. One of the most common challenges related to business interruption insurance coverage is that the coronavirus does not meet the requirements of “direct physical loss of or damage to property”.
Moreover, courts across the country have also argued that the losses of businesses do not count as business interruption insurance claims. Many business owners have had a difficult time getting their claims approved unless they can prove that their businesses were actually contaminated by COVID-19 and have had to shut down the business as a result.
Additionally, some business interruption insurance coverage prohibits compensation related to a pandemic. Since the SARS outbreak in 2003, business insurance coverage has debarred damages related to bacteria or viruses.
However, an experienced COVID-19 business attorney may be able to overcome this obstacle you are facing as some policies only exclude either bacteria or viruses, not both.
Do You Have Civil Authority Coverage?
Your insurance policy may also include civil authority coverage that covers lost income due to business shutdowns. Hotels, airline travel, and airspace have civil authority coverage but sadly were denied by their insurance companies. Many courts as well as the government argued that they did not order these types of businesses to close.
However, the government and courts will compensate businesses with civil authority coverage if the business was ordered to close by the government. Do not let the government and the courts deny your civil authority coverage. Hire an experienced COVID-19 attorney to handle the legal issues of your case and work on getting the damages you are owed.
Your Supporters During The COVID-19 Crisis
The United States will have significant losses in business-related income caused by the coronavirus pandemic. Insurance companies will try really hard to deny or make up excuses to avoid covering any losses. Businesses buy business interruption coverage in the hopes that they will be covered in a national crisis but sadly, they are denied what they are owed.
Business owners need supporters on their side to fight for their rights and ensure that insurance companies pay for their losses.
A Battle Between Insurance Companies & Business Owners
The battle between insurance companies and business owners has been a nationwide crisis resulting in a multibillion-dollar standoff in Washington. The country’s restaurants, hotels, movie theaters, and gyms, have been hit the hardest and have battled on whether insurance companies are responsible for paying claims to businesses that have unexpectedly shut down due to the coronavirus pandemic.
Many business executives have sought federal aid or action in response to being denied by their insurance companies. Both sides have begun a lobbying blitz in an effort to resolve this oncoming issue. The National Economic Council and the Treasury Department have also worked on resolving the issue.
While federal aid may be in favor of business owners in the coming weeks or months, many businesses, unfortunately, cannot wait that long and need an immediate solution.
Hire An Experienced Attorney
If you are a business owner that has been robbed of your coverage, an experienced attorney may be just what you need. Your attorney experienced in disaster-related crises may help speed the process of your case and get you compensated for your damages due to COVID-19.
Your attorney may be able to determine whether civil liability coverage applies to your situation and fight for your rights to get you compensated for business interruption insurance coverage.
Sadly, insurance companies do not want to lend a helping hand to any business owners and only care about profiting. They argue that the coronavirus pandemic does not cover civil authority coverage and business interruption insurance coverage.
Your attorney can offer a free consultation and no out of pocket charges unless they win your case. Do not let insurance companies rob you of the losses you are owed. Hire an experienced attorney today!