Business owners have the duty and privilege to mitigate their losses. This means that you could and should attempt minimize the potential losses you may incur. Mitigating your losses includes protecting your property from further loss or at the least being proactive at protecting against a current loss.
This can include taking or having taken out a business interruption insurance policy on your business. These policies are meant to reimburse businesses for financial losses they incurred due to unforeseen circumstances that prevent normal operation of business.
Business interruption insurance can cover anything from payroll to mortgage payments to relocation costs. The amount of insurance needed, and the cost of that amount depends on a business’s gross earnings and estimation projections of lost future profits as well as risk of loss.
Your policy should kick in between 48 to 72 hours once it is activated. However, it is important to check your ‘restoration period’ which is the length of time when your policy with assist with lost revenue as everyone’s different.
A common problem amongst business owners – COVID losses
A common recovery problem that businesses are currently having are COVID losses. One would think that a global pandemic would be considered an unforeseen circumstance therefore, insurance companies would cover businesses’ lost income during the pandemic.
Unfortunately, it has been found to be the opposite. There are a few policies that do cover COVID loss, but insurance companies have quickly denied them and have launched a campaign to discourage businesses from pursing the claims. An extensive number of businesses have filed lawsuits after being denied coverage from their insurance companies, and all were lost.
Despite the past failed lawsuits, there are circumstances that make a ‘good case.’ The easiest circumstance to be in is that your coverage does not exclude pandemics or infectious disease. Courts have found many clauses to be ambiguous and often decide against the insurer.
Another circumstance is proving that your business satisfies the “physical loss” requirement. This doesn’t always have to include damage to buildings or equipment. It could include safety threats or prohibiting access to use of your property. Another good circumstance to have experienced is that, specifically, the government prohibited access to your business by social distancing, occupation limits, etc. as it satisfies the Civil Authority Clause.
If this sounds like your situation at hand, your next step would be to file a lawsuit. This is a complicated process on its own without insurance companies actively working towards tricking business owners out of viable lawsuits. Insurance companies are known to be dishonest and greedy. They are currently taking advantage of the undefined aspects of COVID cases at the expense of their policy holders.
These cases can be worth hundreds of thousands to millions of dollars.
It is highly recommended that your next step is to contact an attorney. Attorneys are pricey but it is important to note that your claim would be contingency based. That means your lawyer shares the risk of a payout with you. They won’t get paid unless you do, and they get paid more only if you do. You can call us for a free consultation with any questions at 312-346-5320.