At SouthGroup, we have received numerous calls from clients and other leaders in the community regarding business income and the effects COVID-19 will have regarding business interruption. It is true, in the event of a widespread coronavirus quarantine, some businesses may experience a loss in business income for one of many reasons:

  1. Lack of staff to provide services
  2. Lack of clients willing to come to their business
  3. A widespread mandatory quarantine for any length of time

First, we want you to understand that prevention and a responsibly calm outlook are important at this time.

COVID-19 Business Interruption Coverage Concerns

For many businesses, their business insurance may cover the losses if a claim needs to be filled. Their coverages are intended to restore them to the position they would have been in had if not been for the damaging condition. Business interruption coverage is most often included in an endorsement but may be a stand-alone policy.

For more on COVID-19 Business Interruption Coverage Concerns, here is a good article which details some specifics.

Here is some additional information via pillsburylaw.com: Business Interruption coverage protects against losses sustained due to periods of suspended operation due to property damage. In most cases, contagious diseases do not constitute property damage, especially when passed from person to person.

Some businesses have purchased supply chain insurance or Contingent Business Interruption (CBI) insurance to protect against losses stemming from supply chain disruptions. Policies exist to cover interruptions of deliveries of raw materials, parts or supplies, and specialized insurance has been written to cover vulnerable industries…

  • Importantly, CBI insurance commonly covers only losses stemming from disruptions from specific suppliers scheduled on your policy.
  • Moreover, CBI coverage usually requires that the supplier suffer the type of property damage that would be covered in the insured’s own first-party policy. …
  • CBI insurance may well be endorsed with the same Bacteria and Virus exclusions noted above.

Protecting Workers From Coronavirus

As concerns about the COVID-19 continue to rise, many employers are left to wondering what they can do to protect their workforce. This Risk Insights below will examine what coronavirus is, how it spreads, and what employers can do to protect their workforce. 

What Is Coronavirus? 

According to the World Health Organization (WHO), coronavirus is a family of viruses that cause illnesses ranging from the common cold to more severe diseases. Common signs of infection include headache, fever, cough, sore throat, runny nose and breathing difficulties. In more severe cases, infection can cause pneumonia, severe acute respiratory syndrome, kidney failure and even death. Individuals who are elderly or pregnant, and anyone with preexisting medical conditions are at the greatest risk of becoming seriously ill from coronaviruses.    

How Does Coronavirus Spread?

Although the ongoing outbreak likely resulted from people who were exposed to infected animals, COVID-19 can spread between people through their respiratory secretions, especially when they cough or sneeze. 

According the Centers for Disease Control and Prevention (CDC), the spread of COVID-19 from person-to-person most likely occurs among close contacts who are within about 6 feet of each other. It’s unclear at this time if a person can get COVID-19 by touching a surface or object that has the virus on it and then touching their own mouth, nose or eyes.

CDC Interim Guidance

In order to help employers plan and respond to COVID-19, the CDC has issued interim guidance. The CDC recommendations include:

  • Actively encourage sick employees to stay home. Employees who have symptoms of acute respiratory illness are recommended to stay home and not come to work until they are free of signs of a fever and any other symptoms of COVID-19 for at least 24 hours, without the use of fever-reducing or other symptom-altering medicines. What’s more, employees should be instructed to notify their supervisor and stay home if they are sick.
  • Separate sick employees. Employees who appear to have acute respiratory illness symptoms (e.g., cough or shortness of breath) upon arrival to work or become sick during the day should be separated from other employees and be sent home immediately. Sick employees should cover their nose and mouth with a tissue when coughing or sneezing.
  • Emphasize hand hygiene. Instruct employees to clean their hands often with an alcohol-based hand sanitizer that contains at least 60%-95% alcohol, or wash their hands with soap and water for at least 20 seconds. Soap and water should be used preferentially if hands are visibly dirty.
  • Perform routine environmental cleaning. Employers should routinely clean all frequently touched surfaces in the workplace, such as workstations, countertops and doorknobs. 

Additional Best Practices

In addition to following the CDC’s interim guidance, employers should consider the following best practices to help prevent the spread of COVID-19: 

  • Educate employees on the signs and symptoms of COVID-19 and the precautions that can be taken to minimize the risk of contracting the virus, without causing panic.
  • Appoint a single individual or department as the point of contact within your organization for employee questions about COVID-19. 
  • Review safety programs and emergency action plans to ensure that they include infectious-disease protocols.
  • Implement travel guidelines and procedures for approving travel to and from China.

Stay Informed

Despite the current low level of risk for the average American employee, it is important to understand that the COVID-19 situation evolves and changes every day. Employers should closely monitor the CDC and WHO websites for the latest and most accurate information on COVID-19. 

Provided by SouthGroup Insurance Services

This Risk Insights is not intended to be exhaustive nor should any discussion or opinions be construed as legal advice. Readers should contact legal counsel or an insurance professional for appropriate advice. © 2020 Zywave, Inc. All rights reserved.