Letter from PSA’s Property & Casualty Practice Leader

It goes without saying, there are definitive losses that are occurring and will continue to occur as a result of COVID-19. There have been many questions relating to the Coronavirus and what relief may be offered by your insurance policies. All businesses are asking, and it is not good news. We are all disheartened in our recognition that insurance was just not designed to cover losses of this nature.

As we have previously published, Business Interruption losses caused by viruses are not covered by insurance. This type of loss has traditionally been excluded.

Insurance policies were designed by carriers to replace lost business income due to events that cause physical damage to a workplace that force a suspension of operations. Property damage is a required trigger in order to pay claims. Further, many policies expressly exclude damage caused by biological agents including bacteria or viruses.

Workers’ Compensation cases may be covered if illness was the result of on-the-job exposure. In any case, PSA recommends you follow best practices for the safety of your staff, your family, and yourself.

We also recommend that you carefully and fully document any business interruption losses should relief be made available through any government agency. Click here for guidance in gathering key information. Even though a claim is likely to be denied by carriers, PSA can assist you in filing a business interruption claim in order to create a record should conditions change.

We are closely monitoring industry developments. Our team is in contact with Insurance Administrations and has initiated outreach to political representatives to advocate for you. We are collaborating with our industry peers to share strategies to support our clients, and we are working with insurance companies to determine what might be available to our clients in the form of payment relief.

Although the decision to alter your payment schedule rests with the carrier, we are here to assist you with any questions.

In the interim, we have assembled a resource bank of information that will be helpful as you work through this difficult time. Please know that the team at PSA is fully operational and here to support you through virtualized office operations. Your PSA representative can assist you with any questions you may have.

More to come as developments unfold.

Stay healthy and resilient. We will get through this together.

Best,

Frank Giachini, EVP
Property & Casualty Insurance Practice