As Balch & Bingham reported on March 17, many businesses face hurdles to obtaining business interruption insurance coverage. 

On March 19, 18 House members (13 Democrats and 5 Republicans) sent a letter to insurers asking them to cover business losses caused by Covid-19. You can read the entire letter here.

While the letter does not demand coverage for Covid-19, it encourages insurers to “recogniz[e] income losses due to COVID-19” because it “will help sustain America’s businesses through these turbulent times.” The letter concludes by saying: “We urge you to work with your member companies and brokers to recognize financial loss due to COVID-19 as part of policyholders’ business interruption coverage. Additionally, we stand ready and willing to work with you on any future measures that might be necessary to see our country through this trying time.” 

Late yesterday, the insurance trade groups responded, saying: “Business interruption policies do not, and were not designed to, provide coverage against communicable diseases such as COVID-19. The U.S. insurance industry remains committed to our consumers and will ensure that prompt payments are made in instances where coverage exists.” You can read the entire letter here.

This exchange of letters is just the first of what is sure to be many regarding business interruption insurance. As losses mount, Congress is likely to take even stronger interest in this issue. 

Balch & Bingham is monitoring these developments closely.