Many businesses without virus exclusions in their BI policy are still not receiving payment for losses brought on by the pandemic.
It was a seemingly normal day in March that produced the impact we are still feeling today. When the COVID-19 outbreak became classified as a global pandemic on March 11, 2020, sectors and people across the globe had to quickly shift the way they went about their daily lives.
Schools turned to virtual learning, hospital occupancy swelled, and of course, businesses that relied on social gatherings and in-person interaction shut their doors.
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According to Marshall Gilinsky, shareholder at Anderson Kill, the National Association of Insurance Commissioners conducted a data call at the onset of the pandemic and asked insurance companies whether they included an exclusion for a virus or communicable disease event or not.
A common virus exclusion that is used for these policies was originally developed following the 2004 SARS virus outbreak in Asia, per Gilinsky.
Gilinsky also said that this debate was not born from the COVID-19 pandemic.
“For 60 years prior to the pandemic, there had been litigation over the question of whether something that impacts businesses that doesn’t structurally break anything, but nevertheless renders the business unusable, constitutes physical loss or damage,” he said.
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