The coronavirus pandemic has inflicted devastating consequences on individuals, families, and businesses across the nation. When Kentucky’s stay-at-home order went into effect, and shutdowns hit companies across the state, business owners felt the profound and painful consequences of months on end with little to no revenue.
As Kentucky business owners experienced the repercussions of shutting their doors to the public, many rushed to file business interruption claims to mitigate their losses from the pandemic. Unfortunately, many insureds were met with Kentucky business interruption denials as carriers pointed to policy exclusions that supposedly relieve them of liability.
If you filed a business interruption claim due to the pandemic and were issued a denial from your carrier, you should consult with a local attorney who can evaluate your policy. A local attorney can assess your claim for business interruption compensation and aggressively defend your rights against your insurer’s denial.
Business interruption insurance can help owners lessen their financial pain if a disaster makes it impossible to operate business as usual. Because of the intent behind business interruption coverage, pandemics and illnesses have historically not been covered by this type of insurance. For this reason, insurance companies have been issuing countless claim denials stating that business interruption policies do not include the economic losses incurred by business owners amid the coronavirus crisis.
As the coronavirus shutdown has not generally resulted in physical damage to company property, many insurance companies are maintaining these claims do not fall within the purview of business interruption policies. In some cases, the policy language of a business owner’s policies is clear, and there is room to contest a denial and assert a bad faith claim.
There are several coverages in some business interruption policies that may provide compensation for losses stemming from COVID-19.
While a contagious disease would not usually fit the bill for the definition of property damage, depending on the language of the individual’s policy, it may be possible to argue that the business’s economic costs are a covered loss because the disease prevents the regular operation of the business.
Many business interruption insurance policies categorically reject claims for losses caused by bacteria. However, some policies may not implicitly bar claims arising from damages caused by a viral infection, which may be a welcome loophole for business owners seeking to mitigate their losses from the pandemic.
In any Kentucky business interruption claim, it is vital to produce extensive and well-supported evidence to submit to the insurance company. Business owners should maintain thorough records of their revenue losses from the pandemic closure. The claim should note the ongoing costs of running a business that has continued through the pandemic, business costs directly related to the coronavirus, such as the cost of sanitation procedures, and detailed earnings statements pre, during, and post-pandemic.
If you have received a Kentucky business interruption insurance denial of your initial claim, you should not give up. An attorney can offer a comprehensive, confidential analysis of your business interruption insurance coverage and inform you of what options may exist to pursue compensation under your policy.
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