The COVID 19 pandemic has upended the small business community in Pennsylvania.
Weeks without revenue have made it impossible to cover even modest expenses, especially those who were forced to close or remain closed under Governor Tom Wolf’s stay-at-home order.
Today, thousands of non-essential business owners are struggling to recover losses, and some of them are finding an additional roadblock where they thought they’d find help. Insurance companies are denying business interruption claims, even though the state requirements represent nothing short of a costly business disruption.
If your business insurance company recently denied your business interruption insurance claim, then let us help. The attorneys at the Anzalone Law Offices believe you deserve the coverage you paid for, and we’ll fight for you to get it.
What Is Business Interruption Insurance?
Income Loss Protection
Business interruption insurance is an add-on policy designed to protect policyholders from an income loss in the event they are forced to close due to a number of hazardous situations, like natural disasters, fire, theft, vandalism, and other forced closures. Approved claims typically cover the following losses:
- Lost revenue based on what you’d typically make if your business remained operational.
- Payroll for all employees
- Mortgage and lease/rent payments for the business in question
- Tax payments (monthly and quarterly)
- Business loan payments that are due while your business is closed
- Relocation costs associated with a new location or a temporary location
Does business interruption insurance
cover COVID 19?
If you’re wondering if business interruption insurance covers COVID 19 damages, you’re not alone.
Many small business owners are filing claims; unfortunately, many insurance companies are denying those claims.
In some cases, this is due to the definition of “damages.” Business interruption policies require the presence of clear physical damage (e.g., broken windows, fire and smoke damage, etc.) to validate the claim. However, business owners are quick to point out that even though the virus may not leave behind a visual trail of destruction, contaminated surfaces, inventory, HVAC systems, etc. represent a form of physical damage.
Another problem facing small business owners
are policy clauses that explicitly define “viruses” and “outbreaks” as perilous events that are not covered. This verbiage became increasingly common as insurance companies tried to adapt to claims made during the 2003 SARS outbreak. But that doesn’t mean you’re out of luck.
Civil Authority Clauses and COVID 19 Closures
While viruses may not always have a clear place in business interruption policies, other perils are included in policy underwriting. Some policies, for instance, include civil authority ingress/egress clauses.
Under a civil authority clause, policyholders have a right to file a claim if they were forced to halt business operations due to government-issued orders that prevented an individual from entering or exiting a property.
A loss of business due to emergency city closures and curfews may be covered under this type of policy. As such, there may be legal grounds to pursue a claim should your business be shut down due to government orders, as is the case with so many Pennsylvania small businesses that were forced to close due to the ongoing COVID 19 crisis.
Filing a business interruption insurance claim
Business owners and lawyers across the nation are working together to further explore the role business interruption insurance plays in COVID 19 closures. And many, like the attorneys at the Anzalone Law Offices, are working to help business owners pressure insurance companies into fulfilling their contractual obligations.
We think it’s important that all members of our communities are treated fairly by their insurance companies — especially with the future of our communities on the line. We expect insurers to act in good faith and uphold the coverage promised to policyholders, but that has not always been the case. In recent weeks, insurance companies have shown a desire to support their best interest as opposed to honoring coverage agreements, especially as they relate to the ongoing pandemic.
This has led to an increase in total lawsuit claims, and, as of May 21, 2020, over one hundred businesses have filed lawsuits with the federal courts and plenty more filed with individual state governments across the nation
If your business was or continues to remain closed due to the COVID 19 pandemic
we can help. We’ll help you read through and understand your insurance policy as it relates to business interruption coverage, and if your claim has been denied, we’ll fight for you to get the coverage you deserve. Call us today at 877.256.6933 or email us for a free evaluation.
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