COVID-19's impact on insurance according to a c & d insurance services ltd
We have been receiving some questions with regards to how insurance might respond to the COVID-19 outbreak:
Business Interruption coverage is designed to cover the loss of income that a business suffers after a physical loss to insured property. It is important to note that this coverage is dependent on an insurable loss being triggered such as fire, water damage, etc. and does not typically cover financial impact of pandemics. The Civil Authority extension, which covers access to a business being denied by civil authorities following a disaster, is also only triggered by a covered peril and would not apply to the COVID-19 outbreak.
Canadian Insurers have advised insurance brokers that policies are not offered for pandemic-like scenarios, including those related to the current COVID-19 outbreak. Coverage for this type of loss does not exist except for limited scenarios as described below.*
*Some insurers provide some limited coverage for “Food Borne Illness” business interruption or “Outbreak Extra Expense.” This coverage may respond if it was determined that a person at an insured premises had COVID-19 and, as a result, the premises had to be closed and cleaned for a short period of time resulting in loss of income or extra expenses. This type of coverage is more for isolated “infectious or contagious disease” incidents and it would not respond in any way to the larger potential loss of business resulting from a more widespread COVID-19 outbreak or shut down by civil authority.
Please do not hesitate to contact us if you have any additional questions or concerns.
Sincerely,
Brody Stonehouse, General Manager
a c & d insurance services ltd.
Phone: 1-800-229-3590
www.acdinsurance.com