5 Steps for Policyholders During the Coronavirus Outbreak

The World Health Organization has declared the COVID-19 (Coronavirus) as a pandemic and a global health emergency. As of yesterday, cases of the Coronavirus have been reported in the United States in all fifty states. With over 200,000 confirmed cases worldwide, experts predict the outbreak may not peak until Summer 2020.

The concern raised by this new virus reaches beyond just impact on public health. Among the social and economic effects of the global spread of Coronavirus, businesses are experiencing significant financial impacts. Total business interruption is projected to be in the billions of dollars. It is imperative for policyholders to proactively manage their company’s exposures by communicating with their insurance carriers, brokers, and advisors to review their existing insurance policies and to determine how their insurance program may cover potential Coronavirus losses.

Some exposures your company may be facing during this time include: worksite closures, supply chain disruption, government condemnation of work sites, mandated remote work, employee claims, event cancellation, stop-work orders, and other business interruption related claims. As is often the case, the precise wording of insurance policies combined with the manner in which losses are reported will likely control the amount of insurance coverage available to a policyholder.

Below are five steps for policyholders to consider in order to mitigate business risks faced by the Coronavirus and to maximize the availability of insurance coverage for losses:

    1. Loss Precaution: Examine your existing insurance policies to determine if your policies provide coverage of infectious disease- related losses. Have your insurance coverage counsel and brokers assist you in understanding the exact coverage your company holds. Applicable types of insurance policies to review include Property, General Liability, Pollution, Directors &
      Officers, Professional Liability, Fiduciary Liability, and industry specific coverages. Policyholders should also examine the exclusions for disease or pandemic related policies. Close analysis of defined terms in a policy as well as particular verbiage included in exclusions can allow an insured to highlight coverage grants which may help limit the financial exposure related to COVID-19 losses.
    2. Assess Potential Exposure: Identify possible ways the Coronavirus may affect and disrupt your business. Consult insurance advisors and risk management experts to determine hypothetical exposures and strategies. Initiate communication with executives and department heads for insight and understanding of the of potential setbacks, as well as their ideas in preparation and solutions moving forward. Conversation should be continual as exposures develop over time.
    3. Collaborate with Brokers: Insurance brokers can provide your company with valuable insight into coverages available and the behavior of difference insurance carriers. A good broker will help evaluate your current insurance plan and identify gaps in coverage throughout the process. Keep brokers as a key point of contact to advise your business on the actions it should take to manage through this pandemic.
    4. Early Identification & Notification: Improper and delayed notice of an insurance claim can be fatal to your claim. Protect your company’s insurance contract. It is important to recognize claims early in the process and to immediately report the claims to your broker and insurance carrier. Notifying and involving the insurance carrier early will prevent the possibility of unwanted disputes over liability assumptions and time constraints. Additionally, early notice prevents unforeseen issues of policy expiration on claims-made insurance policies.
  1. Detailed Fact Records: After claims are notified to the insurance carrier, proper documentation is crucial. Policyholders should report and record detailed facts about the actual or potential losses incurred as well as the costs associated with the losses. This is especially necessary in business or property coverages.

These small steps can protect your business as we move past this pandemic. Bersinger Law is equipped with the proper resources and experience to maximize your insurance coverage.

For more information, Austin Bersinger is available at austin@bersingerlaw.com or (404) 965-3692.