How Should Insurance Coverage Protect Employers During Covid-19?
As COVID-19 becomes increasingly widespread, it is not just raising fears regarding the well-being of the general public, yet it's also disrupting business operations and creating insurance exposures. In fact, COVID-19 has already triggered business interruptions, supply chain issues and significant liability concerns-all ones can open policyholders around claims. Consequently, it's important for companies to comprehend how COVID-19 can impact their insurance plans, review their existing coverage and ascertain what precautions they need to ingest to control their losses.
The next examines potential insurance exposures linked to COVID-19 and how different forms of coverage could respond.
BUSINESS INTERRUPTIONS
As many operations close due to COVID-19 fears, there's a growing question of whether or not business interruption insurance might help policyholders compensate for lost revenue.
In case of a loss of revenue, business interruption insurance provides coverage for income a company would have earned been with them been operating normally. It can also help to pay for expenses like employee wages, taxes, rent, loan repayments and relocation expenses.
Typically, business interruption insurance policies are triggered with a direct physical loss or damage. Under this interpretation, contagious diseases like COVID-19 wouldn't normally count like a covered loss.
However, some argue that COVID-19 can contaminate physical objects like HVAC systems or assembly lines, which often would force businesses to cease operations. Over these scenarios, business interruption insurance could provide some protection. Still, insurers may push back, making coverage unavailable.
As with all loss, policy wording is critical and may make a huge difference with regards to responding to claims. Policyholders should review exclusions and endorsements alongside a qualified agent to be sure they have the policy they desire.
WORKERS' COMPENSATION INSURANCE
In instances where an employee believes they contracted COVID-19 at the office, many workers' compensation considerations come up. Notably, in terms of workplace illnesses, most state statues just pay out benefits in the event the disease involved is occupational as the name indicated. This means that communicable and contagious diseases are generally excluded from workers' compensation policies.
However, coverage might be triggered if the illness arose due to or perhaps the path of the worker's employment.
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