“Does my policy cover my business for lost income from the Coronavirus?”
“I need to bring in a cleaning company to disinfect my property because of COVID-19. Is that covered by my insurance?”
“Does my insurance cover the loss to my income because the city or state shut down non-essential businesses, including mine?”
Over the past days, I have received a number of questions like the ones above regarding the Coronavirus and insurance policies. The world is frantically trying to navigate the uncharted terrain of a new pandemic. Unfortunately, although everything else has come to a standstill, time has not. Bills become do, and people will be turning to insurance to see what losses they can be reimbursed for.
That is where I come in. Every time I get one of these questions, I have the exact same response: “Send me your entire policy to read.”
The most important thing you can do if you have these questions is to RTFP. “Read the f**** policy.”
As it has been explained, the “F” can have many meanings. For example, it could mean “full”. But that probably isn’t the first word that came to mind for you. It wasn’t for me, either.
Whatever F-word you use to fill the blank, the meaning is the same. READ THE POLICY.
This is not a new concept. It has been written about by experts in the field, like William Wilson and others. There is no uniform blanket answer to any insurance question. You need to read the policy because insurance policies are not all the same. Despite what you may believe, they are all unique in their own way. And as a result, you need to read your own individual policy.
While there are no blanket answers, there are some commonalities that are worth pointing out. But remember, these don’t apply to all policies, so RTFP!!!
Policies often require a triggering event to spark coverage. In a number of policies, that triggering event is a “direct physical loss.” This often is interpreted to mean physical damage. So, if your policy requires a triggering event of physical damage, and all you have is loss of income or loss of business due to closures or decreased business, that may not be covered.
Look Out For Exclusions
Beyond the triggering events, there are also some exclusions you should look for. Many commercial package policies (CPP) have an exclusion, “EXCLUSION OF LOSS DUE TO VIRUS OR BACTERIA.” This is form CP 01 40 07 06, and its application towards losses that arise from precautions taken during the COVID-19 outbreak will likely be a hotly contested issue. If the loss to your property was actually caused by the virus itself, it may fall under this provision.
This is new territory for modern insurance. Finding a way that the Coronavirus and insurance policies affect each other will take some time to work out. How these policies are interpreted by the carriers and by the courts will likely be a long-fought battle. But in the end, if you read your policy, and you don’t know if there is coverage, send me an email at firstname.lastname@example.org with a copy of your entire policy, and I will see what options you may have.
I, and all of us at Wheeler, DiUlio, & Barnabei, P.C. want to wish everyone the best during a turbulent time.