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Can business insurance help during the coronavirus?

You're hard-pressed to prove business interruptions, but other coverage is more straightforward.

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Many businesses are getting hit hard by the coronavirus pandemic as customers stay at home, local governments force closures and staff get the virus. Business insurance can’t help in many of these cases due to policy limitations. But you might get coverage in special cases or, if that fails, financial help through resources that aren’t insurance-related.

Will my business insurance company let me skip a payment?

Most insurers are supporting businesses through coronavirus-related financial hardship. Many are postponing cancellations and late fees as a blanket measure to all policies until a specific date. In some states like California and Georgia, insurance companies are required to extend grace periods, sometimes up to 60 days.

See how the top companies are responding and, if needed, contact yours for more personalized details.

We’ll continue updating this information as the coronavirus situation evolves. This table was last updated on August 18, 2020.

Insurance company Coronavirus response How to contact
AIG AIG is open for new business applications, and its call centers are open for existing policyholders’ support. The company is dedicated to customer safety and service.
  • Complete the contact form for general questions.
  • Try the claims assistance hotline at 877-244-0304.
Chubb Chubb is committed to reducing disruptions for clients during the coronavirus.

Chubb will postpone all policy cancellations or nonrenewals for 60 days for businesses that notify about their inability to make payments. The company will bill for payment but won’t cancel the policy. Chubb will offer premium reductions for qualifying small business clients.

  • Through your local agent or broker
  • Fill out the website’s contact form.
  • Call the New York office at 1-212-827-4400.
CNA CNA wants to provide a consistent level of service and availability.

CNA will work with policyholders to find a lower monthly bill plan if notified of financial hardship before your policy cancellation date. This applies to all property and casualty policies. CNA will continue sending billing statements.

  • Email billing.cna.com
  • Call 877-276-7507.
Liberty Mutual Liberty Mutual cares about the health and safety of businesses and employees.

The company is taking requests for premium extensions. If approved, you won’t receive a policy cancellation notice for nonpayment until after the extended date.

Its premium auditors are offering a special audit for businesses to reassess their coverage levels.

  • To request an extension, fill out the billing contact form with the subject line: COVID-19 payment plan relief request for policy # __.
  • For small businesses: Call 1-866-290-2920.
  • For midsize to large businesses: Call 1-800-320-7582.
  • For premium audits: Request online or call 1-888-224-9246.
The Hartford The Hartford is dedicated to providing transparency and helpful resources for businesses.

It encourages companies up for renewal policies to contact customer service with any concerns about documentation.

At your request, you can get assistance with premium audits to make sure you have the right coverage.

  • Contact your agent.
  • Call customer service at 866-467-8730.
Travelers Travelers wants to provide exceptional service without interruptions.

It’s offering virtual premium audits to find the best level of coverage during this time. Travelers will offer solutions based on your unique circumstances if you are experiencing financial hardship.

  • Contact your agent.
  • For billing questions: Call 1-800-252-2268.
  • For premium audits: Call 1-800-842-4271.
Nationwide This well-known insurer is committed to standing by your side during this time. It’s currently taking requests for financial hardship on a case-by-case basis.
  • Schedule a call with your agent.
  • Call 1-877-669-6877.
  • Email using the website contact form.
Zurich Zurich hasn’t responded with specific billing details for clients during the coronavirus. It is offering a coronavirus hub of information for dealing with insurance issues during the pandemic.
  • For direct billing concerns: Call 1-800-332-6641.
  • For premium audits: Call 1-800-572-8348.

How does business insurance cover the coronavirus?

Different types of business policies may or may not cover the business problems you’re facing during the coronavirus. Those problems involve:

1. Business has dropped due to the coronavirus

If your business doors are open but customers aren’t coming, your business interruption policy probably won’t help with lost revenue. For business closures, many policies exclude diseases or environmental factors.

Other named-peril policies list the reasons you can get coverage, but they may not include infectious diseases. Even if your policy doesn’t exclude pandemics, you typically need to prove the disease caused physical damage or losses to your business. With an illness like the coronavirus, that argument is difficult to prove and may need legal help to press the matter.

However, you may have a case if these situations cause you to lose business or close down temporarily:

  • Supply chain interruptions — If a supplier lowers or stops deliveries to your business, contingent business interruption policies may protect you. Still, a direct physical loss may have to trigger this coverage.
  • Coronavirus cases in your business’s building — If staff or customers enter your buildings with the coronavirus and you have to shut down for cleaning, you might argue that this is a direct physical loss.
  • Nearby attractions or businesses closing — If your business relies on customers coming from an entertainment venue, you might claim a loss if those businesses close because of direct exposure to the coronavirus. Examples may include hotels or stores near a theme park. Like government closures, this case may be difficult to prove.
  • Open-peril policies — If you bought a policy that covers any peril unless specifically excluded, you could claim coronavirus protection if pandemics or infectious diseases aren’t excluded. But you’ll have to prove a direct physical loss to trigger it.
How does the waiting period work? Even if you prove your business interruption policy covers a coronavirus shutdown, you’ll have to meet the waiting period first — typically a couple of days. Business interruption policies are designed to pay until your business can reopen again, which may be for cleaning and sanitizing in this case. However, you may get limited or no reimbursement if cleaning doesn’t take much longer than your waiting period.

2. You have to close your business because of government mandates

Similar to lost revenue, your business interruption policy probably won’t cover government-mandated closures. Insurance companies may argue these closures are preventive and didn’t get triggered by physical damage to your business.

However, a few businesses are taking their insurance companies to court for coverage when the local government forces them to close up shop. This situation involves a tricky case that only holds up under the judges’ discretion. In one of the first cases in the nation of a restaurant seeking coverage for lost income during the coronavirus, a Michigan judge ruled that the insurer only has to pay for lost income under business interruption insurance if the integrity of the business is altered by physical damage, such as a flood or fire.

3. You voluntarily closed your business

You won’t get coverage for closing your doors voluntarily, even to prevent the coronavirus from spreading. Business insurance is designed to reimburse you for unforeseen physical damage and losses. If you’re volunteering to suspend business activity, you probably haven’t suffered any direct damage to your business.

4. You have to cancel business events

Your business event might be protected if you cancel due to the coronavirus, as long as there isn’t a specific policy exclusion for pandemics, epidemics or other viral causes. The surest way of knowing you’ll get reimbursed is if you bought an add-on for communicable diseases.

A few other instances might trigger coverage even if the coronavirus isn’t spreading through your area. Those instances may include your key speaker or entertainment canceling or if surrounding buildings or public transportation close because of coronavirus cases in your area.

5. Your staff get the coronavirus

If your staff gets the coronavirus while on the job, workers’ compensation may help them recover costs and lost income. Workers’ compensation can pay for medical bills, lost wages based on a percentage of average wages and a death benefit.

However, insurance may only cover the illness for workers with an increased risk of getting the virus, like medical professionals. Also, the coronavirus may be covered by workers’ compensation if the employee can prove they caught the disease on the job.

If your small business isn’t required to get coverage but you’re concerned about coronavirus claims, you can still apply for workers’ compensation.

6. Customers get the coronavirus while interacting with your business

Your business could face legal cases from the coronavirus if customers claim you didn’t take measures to protect them. For example, customers might claim your business couldn’t enforce social distancing inside your store or that you didn’t take extra measures for cleaning and sanitizing. A few types of insurance can help in these scenarios:

  • General liability — Your general liability coverage might pay for medical and legal expenses if customers claim doing business with you led to their physical harm. However, some policies exclude epidemics or pandemics specifically.
  • Directors and officers liability — This coverage can help when customers claim your managers didn’t take the necessary measures to prevent the virus from spreading or if key leaders didn’t have a contingency plan in place. Those with a financial stake in the business who lost money might recover their losses with this liability insurance.

Do I need cyber insurance during the coronavirus?

Cyber insurance can bring extra business security as more employees work from home on potentially less secure computers or devices. Insurance companies can even help you strengthen your defenses, so your business is less vulnerable to attacks. But even without business insurance, you can take several steps to help employees working from home stay safe, such as working with your IT team to pick the right technology, software and secure communication tools.

Most cyber insurance policies include coverage for security breaches while employees are working remotely. But you’ll have to meet the requirements laid out in your policy like heightened security measures. You can contact your insurance company to make sure remote workers are covered and to find out the requirements.

Can trade credit insurance help?

Trade credit insurance is another type of coverage that’s likely to pay out for coronavirus claims. If a key client can’t pay their outstanding debt for your business’s products, trade credit insurance can cover some of their unpaid bills.

If you don’t have trade credit insurance, policies are still available. However, you might face higher premiums that reflect the turbulent economy. Some insurance companies may stop new applications altogether.

Compare business insurance during coronavirus

Name Product Workers' comp General liability Product liability Available states
CoverWallet
CoverWallet
All states except RI & VT
Compare multiple quotes for business insurance to find the cheapest rates from this online commercial insurance broker.
The Hartford
The Hartford
All 50 states & DC
Compare wide coverage for almost any business and industry, though you can't complete your quote online.
Insurance321
Insurance321
All 50 states & DC
Insurance321 matches you with an agent who can find the best commercial coverage for your business.
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When won’t business insurance cover the coronavirus?

The reasons your insurance company may deny coronavirus claims can include:

  • Disease, pollution or environmental factors are specifically excluded in the policy.
  • The policy specifies coverage for certain situations only.
  • You didn’t experience a direct case of the coronavirus at your business.
  • The government forced closure but still allows your business to make deliveries.
  • The government enforces sheltering in place, but your business is considered essential.
  • You closed your business as a preventive measure to keep the virus from spreading.
  • The amount of time you need before reopening doesn’t exceed your policy’s waiting period.

What can I do if I’m not covered by business insurance?

If your business experiences losses because of the coronavirus that aren’t covered by insurance, or your claim was denied, you can get business financial support through:

  • Low-interest business loans
  • Small Business Administration disaster loans
  • Coronavirus relief programs — Some companies or local governments are funding cash payments to businesses in financial distress. The federal government coronavirus stimulus package may also provide assistance to small businesses.

Coronavirus-related denied claims

Based on findings using the COVID coverage litigation tracker, we analyzed the number of coronavirus-related court cases that have been filed as of September, 2020 and how many have been disputed by insurance companies. What this report means for businessowners is that business income claims may be more likely to be disputed based on the terms of your policy.

Currently over 1,200 claims have been disputed or have had a motion to dismiss by the courts. Of the number of coronavirus claims currently in litigation, about 87% are related to business income, and almost 21% include a pandemic-related motion to dismiss based on the plaintiff’s insurance policy. The most common reasons for dismissal include that there was no phsyical loss or damage, the policy specifically excluded viruses or the business suspension requirement wasn’t met. Most of the cases haven’t been closed out yet, but the majority of the completed claims were dismissed.

Bottom line

Your business insurance may not provide protection in many cases unless your business is directly affected by coronavirus cases, such as employees or customers getting sick. However, the types of business insurance that may help businesses the most during the coronavirus pandemic include contingent business interruption, event and trade credit insurance policies.

Questions about business insurance during the coronavirus

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