Businesses across the United States have had to shut down due to government closures. Because of this, many are filing business interruption claims. However, a majority of insurance companies are denying these claims citing that there aren’t any physical business losses.
COVID-19 Business Loss Claim Denial
Insurance companies are denying business claims since they say policies exclude losses caused by a virus or related to a government order. This includes a mandatory shutdown of all non-essential businesses. Also, insurers are claiming that businesses cannot prove physical damage or loss has happened. Therefore, insurance claims do not apply.
Virus Exclusions
Since 2003 and the SARS outbreak, some policies specifically exclude loss stemming from viruses. A vast majority do not. Even if there is a disease outbreak in the policy, it may be vague. Plus, a majority of claims include civil authority coverage.
Civil Authority Coverage
Civil Authority coverage applies when local, state, or federal government prohibits access to certain businesses. This applies to COVID-19 businesses, however, insurances are claiming there is a lack of physical damage, therefore the claim is denied. Insurance companies have a financial incentive to deny claims.
Steps After a Denial
After receiving a denial claim, make sure to list questions about the denial. Then, start to compile documents such as your policy and denial letter. The denial could be a simple error. The staff may have entered an incorrect code. However, if your COVID-19 business claim was denied, this isn’t the end of the road. It is just the beginning.
Free Insurance Case Review
Free Insurance Case ReviewIf you or someone you love was negatively impacted by COVID-19, compensation may be available. Our attorneys are experienced with complex litigations. These claims could be complicated and problematic if you do not have the right team in place who are dedicated to fighting for your justice. Our consultations are free. Contact us today.
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