Mar 6, 2024

5 Facts About Business Interruption Insurance You Should Know

business owner looking at computer

Are you considering filing a business interruption claim? There’s a lot of conflicting information out there, and you may be confused about whether you can or should actually file. 

If you’re unsure, read on to learn more about business interruption claims, especially in our current climate. 

  1. The Best Time To File Is Now 

You may be hesitating to file a claim, both because you’re not sure which coverage to file under, and because you might not be certain of your total financial losses. If so, you should still consider filing a claim. 

You don’t have to file under any specific coverage or for any specific compensation in order to get the ball rolling. All you need to do is inform your insurer that you intend to file under all available coverage for full compensation for your business. You will have time to clarify the details, and qualified assistance will help you do that. 

It’s essential to get started right away. The sooner you start this process, the sooner your business may get compensated. 

  1. It’s Unlikely That Filing Will Raise Your Premiums 

There is a fear among insurance policy holders that if they file a claim, their premiums will go up the following year. However, this fear is often unfounded. That’s because premiums tend to go up every year regardless of whether or not you file any claim. You can’t stop that simply by neglecting to file a claim.  

  1. The “Virus Exclusion” Probably Doesn’t Apply To Your Loss 

Some business owners are hesitant to file a claim because they’ve heard that there’s an exclusion related to viruses, and believe it may rule out the losses they’ve suffered. But it probably doesn’t. 

The virus exclusion was added to many policies after the SARS pandemic of the early 2000s, and it allows insurers to get out of paying for physical damage to property caused by a virus. But it does not exclude losses caused by the forced shutdown of a business by civil authorities, by a drop in business due to a lockdown, or many of the other unprecedented business losses.

So file your claim. The virus exclusion won’t stop you. 

  1. Taking PPP Money Doesn’t Disqualify Your Claim 

You may have heard that if your business took a federal Paycheck Protection Program (PPP) loan, that this automatically disqualifies your business interruption claim. The rumour states that because the federal government has already covered your losses, the insurance company doesn’t have to. 

However, this is far from definite. A PPP loan is still a loan which you can be required to repay, which means your business would still hold a debt. Your losses may also be piling up post-PPP, in sums far greater than what PPP provided. 

So even if you’ve taken PPP money, file a claim. 

  1. You Can Fight A Denial At No Upfront Cost

If your initial claim gets denied, that is far from the end of the fight. Even if you’re worried that you don’t have the resources for an extended legal battle, we’re here to help. Morgan & Morgan’s Insurance Recovery Group is equipped to fight and reverse denials, and we charge our clients nothing up front. 

The consultation is free, too. So if your claim gets denied — even if you think the insurer might be in the right — call today to review your options. You may still have a chance at getting your claim honored and aiding your business in this unprecedented time.