Understanding Your Coverage

With the evolution of the Coronavirus (COVID-19), our agency has received a growing number of inquiries regarding the intent of coverage for both General Liability and Property policies. While we cannot offer a blanket statement that certain losses would or would not be covered, we can offer some guidance to help you better understand if any coverage applies. It must be stressed that every claim will be reviewed based on the details of the event and the coverage form(s) applicable. We offer the following for your consideration and review:

Property/Business Income

The vast majority of commercial property policies are triggered by direct physical loss or damage to property. To be covered, any claim must include direct physical loss or damage to property requirements. Further, many policies may include limitations or exclusions that would apply to a specific COVID-19 claim. We find it unlikely that coverage for business interruption under any property policy would be found in the case of COVID-19.

General Liability

There are a variety of factors that may influence the application of coverage for casualty claims. This would be true of a COVID-19 claim, too. It is highly unlikely that the facts of a claim or allegations in a lawsuit may trigger coverage, but even if they did, that coverage may be limited because of exclusions or conditions in the policies. One such exclusion is communicable disease exclusion. Also, consider that COVID-19 is too new to be listed by name, but that should not be construed to mean coverage would be afforded.

Excess Liability/Umbrella

While many insurance companies label their policies as “umbrella” almost all such policies offer little or any coverage that is not present in the underlying policy(s). If the coverage is not found in the primary or underlying policy(s) it is highly unlikely that coverage will be found to exist in the umbrella.

The short answer as of right now is we have yet to find any insurance policy with a coverage form that clearly affirms specific coverage for losses related to Coronavirus/COVID-19 related claims. We’ll continue to research the issue and update you as quickly and as accurately as we can.