Shorter Reads

Coronavirus & business interruption insurance: practical considerations for tenants   

In these challenging times for tenants, claiming for losses in relation to COVID-19 may be difficult but not impossible.

1 minute read

Published 25 March 2020

Share

Key information

Typical business insurance policies cover standard risks and are unfortunately unlikely to cover the impact of COVID-19 (including forced closure by the government). Furthermore, business interruption provisions are normally connected to property damage.

Cover for business interruption due to infectious or notifiable diseases may cover losses relating to COVID-19, which has been classified as a “notifiable disease” by the UK government. However, the purchase by tenants of such cover would have been rare and many policies specify the covered diseases, which most probably do not include COVID-19. Cover under a “non-damage, denial of access” extension to a business interruption policy may also be possible, but, again, this upgrade was not commonly obtained by tenants. The Association of British Insurers has confirmed that forced closure of a business could trigger a claim under such an extension if the infectious or notifiable disease cover is either unspecified or includes COVID-19. Whilst the likelihood of either of these applying is slim, it is still worth checking the policy wording.

Tenants claiming under the policies and extensions mentioned above could encounter other difficulties, for instance there may be a policy requirement for an outbreak at the premises of the business.

We understand that Aviva has already confirmed that its business interruption cover does not include losses arising from COVID-19, although other insurers have highlighted that individual policy provisions should be checked and that coronavirus-related claims would be dealt with on a case-by-case basis.

We therefore recommend that tenants closely check the specific terms of their insurance policies, which may allow claims for business interruption, and speak to their insurers, brokers or insurance advisors as necessary.

Update: Please also see our guide for businesses claiming their losses from the coronavirus outbreak, which has now been published here

Message us with any questions

Related latest updates
PREV NEXT

Related content

Arrow Back to Insights

Shorter Reads

Coronavirus & business interruption insurance: practical considerations for tenants   

In these challenging times for tenants, claiming for losses in relation to COVID-19 may be difficult but not impossible.

Published 25 March 2020

Associated sectors / services

Typical business insurance policies cover standard risks and are unfortunately unlikely to cover the impact of COVID-19 (including forced closure by the government). Furthermore, business interruption provisions are normally connected to property damage.

Cover for business interruption due to infectious or notifiable diseases may cover losses relating to COVID-19, which has been classified as a “notifiable disease” by the UK government. However, the purchase by tenants of such cover would have been rare and many policies specify the covered diseases, which most probably do not include COVID-19. Cover under a “non-damage, denial of access” extension to a business interruption policy may also be possible, but, again, this upgrade was not commonly obtained by tenants. The Association of British Insurers has confirmed that forced closure of a business could trigger a claim under such an extension if the infectious or notifiable disease cover is either unspecified or includes COVID-19. Whilst the likelihood of either of these applying is slim, it is still worth checking the policy wording.

Tenants claiming under the policies and extensions mentioned above could encounter other difficulties, for instance there may be a policy requirement for an outbreak at the premises of the business.

We understand that Aviva has already confirmed that its business interruption cover does not include losses arising from COVID-19, although other insurers have highlighted that individual policy provisions should be checked and that coronavirus-related claims would be dealt with on a case-by-case basis.

We therefore recommend that tenants closely check the specific terms of their insurance policies, which may allow claims for business interruption, and speak to their insurers, brokers or insurance advisors as necessary.

Update: Please also see our guide for businesses claiming their losses from the coronavirus outbreak, which has now been published here

Associated sectors / services

Need some more information? Make an enquiry below.

    Subscribe

    Please add your details and your areas of interest below

    Specialist sectors:

    Legal services:

    Other information:

    Jurisdictions of interest to you (other than UK):

    Enjoy reading our articles? why not subscribe to notifications so you’ll never miss one?

    Subscribe to our articles

    Message us on WhatsApp (calling not available)

    Please note that Collyer Bristow provides this service during office hours for general information and enquiries only and that no legal or other professional advice will be provided over the WhatsApp platform. Please also note that if you choose to use this platform your personal data is likely to be processed outside the UK and EEA, including in the US. Appropriate legal or other professional opinion should be taken before taking or omitting to take any action in respect of any specific problem. Collyer Bristow LLP accepts no liability for any loss or damage which may arise from reliance on information provided. All information will be deleted immediately upon completion of a conversation.

    I accept Close

    Close
    Scroll up
    ExpandNeed some help?Toggle

    Get in touch

    Get in touch using our form below.