With a number of provinces declaring a provincial state of emergency and, as of March 22, 2020, the Canadian federal government examining the Emergencies Act (but not yet enacting it), it is clear that we are in exceptional times. Businesses opt into insurance policy plans to guard against the impact of exceptional times. We always hope that we never need to use these policies, however, they can be useful in those exceptional times. Below is an overview of insurance policy considerations that will help to determine whether you have insurance coverage for business interruptions caused by COVID-19.  

Of course, analysis of insurance coverage is provided on a case by case basis and will be determined on the specifics of your insurance policy agreement. However, here are some considerations:

• Do you have insurance coverage?

• What does it cover? (i.e. commercial property insurance, general liability insurance, business interruption, business interruption policy, supply chain insurance)

• What are the specific perils that your business would experience that would trigger the insurance protection? Is it specific (i.e. fire, theft) or is it general? If it’s specific, does it include something akin to global crisis/pandemic?  

• What are the impacts of the perils that are protected?  (i.e. physical loss, physical damage, loss of profits)

Whether or not your business’ insurance policy can be triggered is very contextual, depending on the terms of your policy that sets out the scope of eligibility and also factoring in the specific fact scenario of the impact of COVID-19 on your business. 

It is likely that insurance companies will be experiencing a surge in claims and it is important to prepare yourself, in the event that you wish to trigger your insurance protection.