As concerns over the recent coronavirus outbreak (COVID-19) continue to grow, business owners have been taking unprecedented steps in an effort to prevent the virus from spreading. Employers are restricting employee travel, cancelling events involving large groups of people, asking employees to work from home, and taking other steps within the workplace to prevent the spread of the virus from common spaces, washrooms, door handles, and work stations.
The Ontario government has reacted by reducing the wait time for EI benefits for people who are off work due to the virus. Some employees who are off work due to self-isolation or are being forced to stay home because of a potential outbreak at their workplace are making claims under their short term disability policies or WSIB coverage.
The threat of a pandemic is also causing employers to prepare for the potential that their business could be shut down if an employee contracts the virus and risks infecting other employees. Very recently, an office in Toronto was shut down when one of its employees was diagnosed with the coronavirus and came to work spreading it to others. This proves that this concern is a real possibility and not simply a hypothetical.
As businesses consider how they will cope with a potential shutdown of their operations, business owners are reviewing their commercial insurance coverage to determine if it includes business interruption insurance coverage. Even those companies who have specific business interruption insurance need to ensure that their insurance will respond to COVID-19 induced losses. Similarly, insurance companies are preparing for what they expect may be an influx of these type of claims.
The answer to whether a company’s commercial insurance or business interruption insurance will cover such losses lies in the terms and conditions contained in each commercial insurance policy.
In short, every business owner needs to carefully review their insurance coverage to determine if the risk of business interruption from an event such as a pandemic is covered under their insurance policies. These policies should also be reviewed to determine if there are certain exclusions which insurers will raise to deny such claims.
In addition to the question of whether a company will have insurance to cover potential losses from a coronavirus shutdown, an equally difficult exercise will be documenting and calculating the losses should they occur. That issue will be a moot point if business owners cannot find an insurance policy with coverage which will respond to this type of loss.
Leonard Kunka is a partner and personal injury lawyer at Thomson Rogers whose practice is focused on advocating for those who have been seriously injured in motor vehicle accidents. Leonard can be reached at 416-868-3185 or by EMAIL.