Covid 19 continues to wreak havoc on the health of our beloved community in South Central Pennsylvania. There is also a huge economic impact associated with this that cannot be ignored. Businesses small and large were already feeling an impact from efforts to social distance before Governor Wolf’s Order which effectively shut down all nonessential businesses. At present, these businesses are left with looming bills and expenses and no way of generating income. It is times like these, that some outside the box thinking might offer a solution to many small business owners.
One of the larger expenses of a small business is insurance. One aspect of a business’ property insurance is what is called business interruption coverage. Business interruption coverage generally covers when business operations are interrupted or disrupted by a fire, natural disaster or when a supply chain has been interrupted or broken because a supplier has been physically damaged. However, lawyers around the country are attempting to classify the continuous existence of Covid 19 in or around a business’ premises as indirect physical damage, which would trigger this coverage. Further, some commercial property policies may include coverage for losses caused by forced closure of a property by a civil authority. So….what should the small business owner do?
Step one is to dust off any applicable property insurance policy and give it a good read over. If there is a provision specifically excluding “infectious disease coverage,” then this is most likely not an avenue for that specific business owner. If there is not a specific exclusion, the argument can be made that the insurance company should have specifically excluded that coverage if they wanted to and chose not to. The key to coverage here will be the actual language in the policy. Remember, the entire policy must be read and understood.
Step two is to immediately file a claim. The insurance company will likely say no. This is to be expected. This should be done in writing and all appeal processes applicable should be explored.
Step three is to gather detailed financial records. Losses, if applicable, will be based upon revenue that a company would have earned and can only be shown by looking at historical records. If a company is not seeing business interruption, then there is likely no claim here. This should be in order, and easily interpreted. If available, these should be submitted with the claim.
Step four is to call your legal counsel. They will be able to walk you through the complexities involved with this type of litigation. This is uncharted and unprecedented territory, but it is also an area ripe for interpretation which only the courts will be able to provide. Now, through the month of April, Mooney Law is providing FREE PHONE consultations in all areas of law. That includes Business Law. Give us a call today to schedule a free phone consult at 717-200-HELP or 717-632-4656 or drop us an email at info@mooney4law.com.
