A common question we are receiving these days is whether a contagious virus (you may have heard of it) causing loss to business revenue is covered by the business interruption coverage on an insurance policy?
Business Interruption coverage is set up to pay for ongoing expenses along with the optional loss of profits that can be added to the policy. I’ve often heard this referred to as disability insurance for your business, allowing the loss of income to be offset by the insurance policy and keeping the business out of extra financial hardship during this time.
Insurance brokers absolutely love being the bearers of great news, so these past few weeks have been difficult as the answer to the question about business interruption is consistently “no”! This is due to the way that business interruption coverage is set up – the coverage is triggered only when there is an insured peril that causes loss to your physical premises insured under your policy. As COVID-19 is not causing damage to property, the loss of revenue from this virus does not trigger the business interruption insurance coverage.
While we are seeing multiple insurers reminding us of the basics of business interruption, we are being advised that each policy is unique and it is in your best interest to call your insurance broker and ask if coverage would apply. This is also a great time to review the vacancy provision and liability conditions surrounding this virus to make sure you understand how your policy will respond to your specific situation.
Still have questions? Rempel Insurance Brokers Ltd. are open for business throughout this pandemic and are glad to assist you with your insurance needs throughout this and all seasons of life. We wish you health and rich moments with your family throughout this time.
David Schmidt is an Account Executive at Rempel Insurance Brokers in Morris, MB, specializing in insuring farms and businesses across Manitoba and Saskatchewan.
Office (204) 746-2320 Text (204) 712-6618 Email davids@rempelinsurance.com Web www.rempelinsurance.com