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Business Insurance Issues to Navigate During COVID-19

When you run an insurance agency, you're a business owner facing all of the ups and downs that other business owners are facing during COVID-19. From the closure of storefront locations and a switch to working from home to overwhelming business in some categories and changes in business in others, you're facing numerous challenges that impact your business. 

As a business owner, what kinds of business insurance might you need to call on to protect yourself during COVID-19 and ensure that your insurance business is able to survive this crisis?

Business Interruption Insurance 

According to the National Law Review , "many commercial property insurance policies provide coverage for financial losses due to business interruption suffered as a result of “direct physical loss or damage” to covered property." However, this clause may or may not apply to your property closures that were caused by COVID-19. In some states, this is excluded, and some policies may not cover closures due to the virus because it has not caused direct physical damage. 

When it comes to business interruption, while this has not entirely been settled yet, you may not receive coverage in this area. According to Entrepreneur, to help determine this, look at your cause of loss to trigger coverage, and see if it covers: 

  • Business interruption;

  • Payroll ;

  • Civil authority such as the government asking people to shelter in place;

  • Contingent business interruption or extra expense;

  • Contingent extra expense (this reimburses lost profits and expenses resulting from an interruption of business at the premises of a customer or supplier);

  • Ingress/Egress clause that pays for an occurrence that prevents or hinders ingress to or egress from the business. 

Ensure that you have a complete copy of your insurance policy on hand so that you can look at it in its entirety.

Clients who become ill after visiting your business might choose to pursue legal action. 

Illness of Clients or Employees

If your clients or employees believe that they have contracted COVID-19 at your workplace, two insurance policies may be able to help. 

Workers' compensation benefits should help to cover your employees' illnesses. Moreover, your clients should be covered under your commercial general liability, which covers bodily injury. 

Look at E&O Insurance for Help 

Right now, your clients are financially and emotionally stressed. Unfortunately, in past recessions, financial stress has led to issues with insurance fraud. While this could involve damaging a vehicle or a home, it could also involve false cases against your insurance agency. 

For instance, if a client feels like your business has made an error or an omission that has impacted their financial wellbeing, they could demand compensation. These accusations could be founded or unfounded, but they can be equally damaging to your business. Using E&O insurance, you can make sure that a case like this won't bankrupt your agency during this precarious time. 

Now more than ever, businesses need community. When you're looking for a community of independent insurance agencies, look no further than the American Agents Alliance. Contact us today to learn more about our many options for your insurance agency, such as E&O insurance

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