The COVID-19 pandemic has drastically changed many small businesses. Restaurants, bars, hair salons, pizza shops and other small business have lost significant revenue.

Examples of lost income:

• The business was forced to shut down or had to operate at reduced hours
• The business switched to takeout and delivery only

It is important to talk to an attorney at Simmons Hanly Conroy about your business interruption policy and how you may be entitled to compensation if you lost revenue due to the pandemic.

Business insurance is supposed to protect business owners from unexpected losses. While there are many types of insurance policies for businesses, it’s common for business insurance policies to include business interruption coverage (also known as business income coverage). This type of coverage is specifically meant to replace income when a business can’t stay open due to a covered peril or hazard.

According to the Insurance Information Institute (III), “business interruption insurance compensates you for lost income if your company has to vacate the premises due to disaster-related damage.”

For the many business owners whose lives were upended to stop the spread of COVID-19, the pandemic has had disastrous consequences. What’s more, business interruption insurance policies may cover closures due to civil authority. Civil authority coverage allows business owners to be compensated for lost income if they must close their business operations to comply with a government order.

The COVID-19 pandemic has completely changed the way countless organizations are conducting business. Wanting to protect their livelihoods, many small business owners are wondering, “how can I seek coverage for COVID-19 losses?” Business owners who were denied business insurance payments or are just beginning the claims process should contact Simmons Hanly Conroy to learn more about their legal rights.

What Does Business Interruption Insurance Cover?

Small business owners rely on business interruption insurance to cover a variety of operating expenses.

Business interruption insurance may cover:

• The revenue a business would usually make during normal operation
• Payments for a business’s mortgage, rent, and loans
• Monthly or quarterly taxes
• Payroll for a business’s employees
• Cost of relocating to a new/temporary location (if applicable)

This coverage can mean the difference between staying afloat and bankruptcy. It helps small business owners to continue operating their business and, more importantly, allows them to provide for their families.

Business owners may be denied insurance payments for a variety of reasons.

Challenges include:

• The policy’s language limits the coverage a business may be able to receive
• Some policies do not cover damages caused by viruses, bacteria, and microorganisms

For example, when the SARS outbreak swept the nation in 2003, some insurance companies changed their policies to exclude losses caused by microorganisms. However, some companies only deny coverage for bacteria-caused damages — not damages from viruses.

Different policy requirements for disaster-related damages may be confusing to business owners who are just trying to put food on the table. This is why it is crucial to reach out to an attorney.

Simmons Hanly Conroy lawyers can help small business owners review their policies. Even if you are just starting the claims process, it’s important to have a lawyer on your side.