If your state ordered you to close your company’s doors throughout COVID-19, you may have faced a significant interruption in your business. If your storefront or office is closed and sales are plummeting, you may think that a business interruption insurance claim can help to recoup some of your losses.
Business Interruption Coverage in the Pandemic
Some business owners are finding out that it’s not as simple as filing a claim and receiving a check. Insurers say that business interruption policies only provide coverage when policyholders suffer a loss of income because of physical loss or damage to their business.
Many insurers have been denying claims because, following this definition, losing from a COVID-19 related shutdown would not qualify for a payout. Typically, this insurance coverage compensates business owners for lost revenue and other expenses if a fire, flood or other disaster forces a business to close their doors temporarily.
What this insurance doesn’t usually cover, however, is income businesses lose because they must scale back their operations. For example, a restaurant that can’t offer dine-in service but can offer pickup and delivery wouldn’t necessarily be able to file a claim.
If you are looking for insurance during this time, first consult your policies. Read your coverage carefully to determine exactly what it does and does not cover. From here, you might build a case for an insurance payout. Document how the pandemic has impacted your business, collect supporting documents, and file a claim through your insurer.
At Economic Development Collaborative, we understand that it’s a challenging time for all. Click here to access the free resource guide for your business that can help you take the next steps for your company.