Almost every business is scrambling to manage the potential effects of the new coronavirus, COVID-19. And rightly so. Whether they’re concerned about protecting employees and clients or anticipating the effects of supply-chain slowdowns or quarantines, almost no business is immune.
The vast majority of policies exclude communicable diseases for business interruption coverage.
Business interruption or business income insurance is designed to cover lost income due to damage to the insured’s physical property. Most often claims stem from a natural disaster, such as a tornado or fire. It usually includes the cost of setting up a new/temporary location, taking care of customers, keeping payroll going and some of the lost sales that may result.
Unfortunately, most policies don’t include coverage for loss of income based on diseases or viruses. Now is a good time to check yours and talk with your broker if you have questions. In the event of quarantines (or prompts to work from home from officials) the manufacturing and construction industries will be amongst the more heavily impacted.
What you can do now
If you aren’t already taking steps, here are some ideas to get started:
- Plan for how travel restrictions, quarantines and work-from-home requirements might affect your business.
- Make whatever provisions are necessary for the effects of supply-chain slowdowns to your business.
- Put measures in place to protect your workers and workplaces. The WHO has specific recommendations for workplaces, and the CDC has a wealth of information.
Longer-term actions you can take
This situation is a good reminder to review your business income insurance limits. We often find that new clients are under-insured, because their business has grown, and they haven’t increased their limits accordingly. I would recommend looking at them annually with your broker. To stay up to date on the latest COVID-19 news from The Miller Group, visit our COVID-19 resource page.
By Tanner Smith, Commercial Insurance Advisor
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