07 Apr Is the Coronavirus Causing a Change in Your Client’s Exposures?
First and foremost, my sincerest thoughts and prayers to all of the staff of the E&O Plus agencies and their families hoping all are healthy and safe. Without a doubt, our lives as we knew them are anything but normal.
Every day, we are all receiving information about the virus and how best to protect ourselves – and hopefully, everyone is adhering to those instructions. In this blog, I wanted to touch on a few insurance issues as I see them.
Without question, the Coronavirus is causing major issues for businesses of all sizes, primarily a loss of revenue and subsequent employee reductions. However, there are some other potential issues that your clients may be dealing with, and I would encourage agencies to seek opportunities to identify those that could have insurance ramifications. These include:
- Businesses being used for a purpose other than what they were designed to do. Examples include schools being converted to daycare centers, theaters and auditoriums used for storage of supplies, or college dorms and hotels becoming makeshift hospitals.
- With much of the nation on a significant lockdown of some type, restaurants are now much more active in delivery of their products to make ends meet (hopefully). Who is actually doing the delivering (possibly employees), and do they have the proper insurance protection?
- Lastly, and unfortunately, some businesses have been forced to shut down, potentially resulting in a vacant building scenario.
These are all issues in which agents need to be sensitive around. Agents should encourage their clients to bring these issues to their attention. One issue that I am personally aware of involves a theatre (I am a Past President of the theater). The theater may be used for material storage and as an area for health care workers for showering, etc. Will the insurance carriers be willing to continue on the coverage when the exposure is now different? It is best not to assume and to contact the carrier with this new exposure information.
One other item relating to the Coronavirus is the degree in which insurance carriers will cover business interruption costs. A recent Bloomberg article indicated that those costs could be more than $380 billion a month! While this would be extremely beneficial for many businesses (especially small businesses), it would probably place a tremendous hardship on the insurance marketplace. While it’s heavily contended that there isn’t coverage in most policies, agencies should be careful not to decline any claims as this is the carrier’s role. With my local theatre, I have encouraged them to keep track of the financial impact of the virus just in case there is an opportunity to submit a claim. No guarantees that anything will come of it, but just in case. Something for agencies to consider…
Stay safe!