Businesses Closed Due To Covid-19 Pandemic May Be Able To Recover Losses From Their Insurance Carrier

Date: May 6, 2020
Posted In: In The Community | Press

COVID-19 and Business Interruption Insurance: What You Need to Know

The COVID-19 pandemic has had far-reaching implications across the globe and has impacted nearly every business here in the United States. If your business has suffered losses because you were forced to close your doors and your business insurance carrier is denying your rightful claim for reimbursement, the attorneys at Dougherty Leventhal & Price, LLP may be able to help you.

What is Business Interruption Insurance?

If you’re a business owner, you likely have insurance to protect various aspects of your business. For example, if your workplace suffers a fire or a governmental order requires your business to cease operations, you have insurance to cover your resulting losses, including coverage for lost business income when a business cannot operate.  This insurance is there to help cover your losses in the case of a negative event outside of your control—as our country is experiencing right now with the deadly COVID-19 pandemic.

What Type of Businesses May Be Eligible To Recover Losses?

Government shut-down orders have caused billions of dollars of economic damage and have caused thousands of businesses to shut down, or to lose revenue by having only partial operations.  Businesses being impacted include, but are not limited to:

  • Restaurants and bars
  • Retail stores
  • Barbershops, salons and spas
  • Child and pet daycare centers
  • Gyms, pools and health clubs
  • Golf and social clubs
  • Amusement parks
  • Entertainment companies
  • Construction companies
  • Contractors, including photographers, videographers, and marketing and consulting firms
  • Non-life-sustaining healthcare providers (i.e. Non-Emergency Medical Providers, Dentists, Periodontists, Physical Therapy, Chiropractors)

What if My Insurance Policy Excludes Coverage For Virus-Related Losses?

Insurance policies are written by the insurance companies.  The policies usually include various coverage exclusions that may or may not apply to any particular claim.  With respect to business interruption claims relating to the COVID-19 pandemic, insurance companies are universally denying claims based upon several policy exclusions, most often one relating to “virus or bacterium contamination.”  However, this exclusion is not applicable because the economic loss being suffered by Pennsylvania businesses actually results from the Governor’s shut-down order, not any actual virus contamination.  Because most insurance policies do not exclude coverage when a business is forced to close or limit its’ operations due to a Government order, insurance companies are wrongfully denying thousands of valid economic loss claims being made by Pennsylvania businesses.

What if My Business Received Government Assistance?

The Federal Government has provided financial assistance to many businesses impacted by the COVID-19 pandemic through various relief programs. The Payroll Protection Program is one such program.  It grants loans to qualifying businesses primarily to maintain employees on payroll during the pandemic.  Despite this assistance, many businesses are still struggling because their insurance carrier has denied their business interruption claim and the Government’s assistance does not cover all of their losses.  Business owners should be aware that receipt of financial assistance from the Government does not disqualify them from recovering economic losses from their insurance carrier.

How Do I Make A Claim For Business Interruption Losses?

If your business has suffered economic losses due to the COVID-19 pandemic and your insurance carrier has denied your business interruption claim, contact one of the attorneys at Dougherty Leventhal & Price, LLP for a free consultation.  The continued operation of your business may depend on it.

John Finnerty
Attorney Finnerty has been representing clients in Northeastern Pennsylvania as an Attorney with Dougherty Leventhal & Price, LLP for over 25 years.