Insights 101: Coronavirus and business interruption insurance
We are living in unprecedented times. Breaking news alerts are now commonplace. Together, we’re working to figure out what the Coronavirus means for our lives and our livelihoods. This is why we are getting many questions about Coronavirus and business interruption insurance.
In these uncertain times, we are working hard to deliver answers to questions you have about business insurance and Coronavirus. We are talking to our insurance partners about this evolving situation.
In addition, we’re also working to deliver helpful content. Our goal is to provide the information you need to make informed decisions about business insurance Canada.
Kindly keep in mind that each and every insurance policy is different and coverage should be formally reviewed by your broker and/or insurer. The following is not legal advice and/or a formal claims interpretation and has just been prepared to help people better understand the typical business insurance policy and typical business interruption coverage.
What to know about business interruption and Coronavirus
It’s likely that you are trying to figure out how Coronavirus will impact your business, today and in the future. So are we.
Typing “business interruption insurance Canada” into your search bar is what most likely brought you here.
Now more than ever, understanding business insurance Canada, what policies actually cover as well as what isn’t covered is fundamentally important.
Since day one, we’ve stood out in the marketplace because of our commitment to delivering helpful insurance insights. This is just one example of the more than 1,000 business insurance topics that you can find in our blog.
How business interruption works
First things first. Commercial property policies typically include business interruption insurance Canada. Your property coverage will respond to standard losses that are specifically outlined in your policy, such as:
- Losses due to fire or lightning, including the cost of removing property as a way to protect it from further damage.
- Extended perils. Such as acts of terrorism, civil commotions, earthquakes, explosion, floods, hail, riots, smoke as well as vehicles that damage your property.
- Malicious mischief and/or vandalism may also be covered.
This means that business interruption insurance Canada only responds to damage to an insured peril that’s listed in your property policy. Actual physical damage caused to insured physical assets are what trigger a business interruption situation.
When an insured peril such as a fire, flood, sewer back-up or lightning strike causes a loss of revenue, your business interruption coverage will respond. Neither business interruption nor interruption by civil authority coverages are built or intended to cover financial loses resulting from viruses, pandemics and/or diseases.
As a result, loss of revenue specifically due to Coronavirus is not covered under any property insurance policy in Canada to the best of our knowledge.
Are there any exceptions?
Good question. While 99% of business interruption and interruption by civil authority coverages don’t cover financial losses related to pandemics, some highly specific coverage may be available.
If your business purchased a standalone event cancellation policy prior to the pandemic, your coverage might respond to Coronavirus situation.
It is also possible that when closed international borders prevent the movement of physical goods, contingent business interruption coverage may respond.
This type of insurance is an extension to standard property insurance. Contingent business interruption is typically used in situations when:
- The insured company depends on either a single supplier or a few suppliers for materials.
- One or a few manufacturers or suppliers provide most of the insured’s merchandise.
- Just one or a few recipient businesses purchase the majority of the insured’s products.
- The insured company counts on a neighbouring business – known as a leader property – to help attract customers.
Whether or not your coverage will respond is something that you need to talk to your ALIGNED broker about. They are here to help you get answers to any questions you may have about your business insurance policies.
Questions about Coronavirus and business interruption? Contact us.
Are any insurance companies in Canada offering coverage for Coronavirus financial losses?
To date, insurance companies in Canada have not offered specific coverage for Coronavirus related financial losses. We do not anticipate any coverage in the near future.
That being said, we are paying close attention to the marketplace. We are speaking with our insurance partners on a regular basis and keeping watch for any new products that may become available.
Useful business insurance Canada information during Coronavirus
Insurance insights. With more than 1,000 insurance info articles on our blog, we are constantly adding new content – such as this article – to help people navigate the insurance marketplace.
The Coronavirus pandemic is no exception. It is changing lives and livelihoods. That’s why we are highlighting specific insurance topics that are particularly relevant at this moment in time.
Whether you want to adjust your business insurance Canada to reflect changes to your operations or renewing your coverage, we are here to provide expert advice and options.
Here are some insurance insights that are particularly relevant during Coronavirus:
- Is your business closed? It still needs insurance. Understand how unoccupied property insurance can fill an important gap.
- Are you looking at your top and bottom lines? You are not alone. The cost of doing business is on everyone’s minds. This is why we’ve created an article about reducing the cost of business insurance in Canada.
- People matter. That’s why understanding employment practices liability insurance is important when you are considering employee layoffs. Good human resources practices and working with experienced insurance brokers are essential to managing EPL risks. Learn more about employment practices liability coverage.
- Change happens. And situations such as the Coronavirus pandemic may have you thinking about changing your commercial insurance Canada coverage. This helpful article outlines the risks, risk management and special considerations when changing your insurance coverage.
ALIGNED brokers understand the nuances of commercial insurance coverages and can help you make informed decisions about your business insurance options. During Coronavirus and anytime, we are here to support you with information and expert advice.
We invite you to bookmark our insurance info blog to keep current with Canadian insurance insights.
More than just business insurance…
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