Business Interruption Insurance Claims: Nuts & Bolts

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Every business is thinking about business interruption insurance given the COVID-19 pandemic. Business interruption insurance is not the only potential coverage for business owners; other potentially applicable coverage provisions include contingent business interruption, extra expense, civil authority, and event and other cancellations. Because these other coverages may exist, as do/will government relief, it is critical to review all portfolio policies, promptly notify your insurance carrier (typically through your agent), and properly document your losses and establish claims procedures. The rest of this supplement to last week’s article, Business Interruption Insurance Coverage For COVID-19 Losses, focuses on the latter.

Claim Considerations

Tracking and Supplementing Essential Information

More Specific Costs to Track

The foregoing outline should help business owners of all varieties better understand what they need to do to properly document claims for coverage and/or government relief programs – and for any future or related litigation that might ensue depending on the circumstances. It can’t be emphasized enough that each claim is different – due to different insurance policy provisions, different factual circumstances giving rise to the claims (e.g., infiltration, presence of disease, remediation, shelter-in-place, business closure and other government action, etc.), and the nature and operations of the business. In all cases early establishment of the elements of handling business interruption insurance claims, of whatever nature, prompt notice to carriers and government relief agencies, and proper documentation of losses are critical.

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