At the risk of stating the painfully obvious, these are extraordinarily trying times for businesses, many (if not the vast majority) of which have been mostly, if not entirely, shut down on account of the Coronavirus pandemic. As we all know, this has forced many businesses to make gut-wrenching decisions, ranging from whether to institute company-wide pay cuts, rotating furloughs, or outright lay-offs. This has taken a huge toll not only on the businesses' bottom lines, but has also exacted a heavy emotional, human toll as well.
Beyond the requests for governmental assistance through various programs, including the Paycheck Protection Program of the federal Small Business Administration, the question some small and mid-sized businesses should be asking is "What other options do we have to keep our business afloat until this storm passes?" The answer to this question is all the more significant due to the delays - or outright denials - that the vast majority of businesses have received thus far.
Does Your Insurance Policy Cover Your Business's Losses Due to Coronavirus?
There is a particular form of insurance policy that may cover these losses, called "Business Interruption Insurance." If you have such a policy, great; it gets you through the proverbial front door. But that doesn't guarantee you will be able to collect under the policy, nor, for that matter, does it inherently mean that you will be able to recover your true losses incurred as a result of this pandemic.
Not surprisingly, there have already been a number of lawsuits filed on account of insurers' denials of these claims, and the reasons vary, whether because the policy ties recovery to physical property damage, that the policy does not expressly provide coverage for losses incurred due to a virus, or simply that the insured's claim was not filed "as soon as practicable."
Why It's Important to Get Your Business Interruption Policy Reviewed Sooner Rather Than Later
To be sure, whether the terms of your policy cover your losses secondary to Coronavirus isn't likely to change with the passage of time, that is decidedly untrue with regard to an insurer's ability to disclaim coverage due to late notice. In that regard, timing is everything; lateness alone can kill an otherwise viable claim. And it's a completely avoidable mistake.
If you have a business interruption policy, get a copy of it over to an attorney who is knowledgeable about these kinds of breach of contract claims - pronto - so they can review it, and if applicable, file a claim with your insurer as soon as possible.
The survival of your business may depend on it.