Have you faced financial losses during the COVID-19 pandemic? How do you want to compensate for that?
COVID-19 is still spreading across the world, impacting both individuals and businesses. Although some industry niche areas like IT-based brands have benefited from this crisis, others have lost their income.
This is the biggest threat to the world’s economy since world war II and has raised controversial arguments about how business problems can be solved.
The insurance industry can play a significant role in reducing the problems during and after the crisis. Thanks to the internet, you can easily buy insurance online and protect your business from further losses.
So it’s important to know the different options insurance firms will provide your business with.
Here are several key features of business insurance you can be benefited from during the COVID-19 pandemic.
Business interruption insurance
The COVID-19 crisis has caused many businesses to close or bear a significant reduction in sales. Many of the businesses are looking for a way to compensate for their loss.
Fortunately, there are promising options in business interruption insurance that help brands in this situation. Business interruption insurance is an important part of risk management plans.
This insurance covers the loss of income a business has endured during a crisis compared to the condition it would operate normally. Business interruption insurance can also pay you some of the expenses such as employee salaries, taxes, loan payments, rent, and relocation.
Generally, this kind of insurance is involved with various physical losses or damages your business might incur. Many argue that COVID-19 is not a physical loss to your business, so this insurance will not cover your losses.
On the other hand, many commentators believe that some physical systems such as air conditioners can be covered.
So you need to make sure whether your business insurance will cover such losses.
Workers’ compensation insurance
Some of the workers’ compensations are implemented when a worker believes COVID-19 infects them in the workplace.
Unfortunately, many insurers only offer benefits if the illness is relevant to your occupation. So contagious diseases such as COVID-19 are excluded from workers’ compensation insurance.
Of course, they might cover workers’ illness if it has been caused due to their employment. These conditions should be examined case-by-case, but some examples are exceptional.
For example, a nurse or a worker in the healthcare industry who COVID-19 infects at work is excluded from a case-by-case examination.
Contingent business interruption insurance
This one is helpful when it comes to disruptions to a third party. Despite the traditional types of business interruption insurances, contingent business interruption lets your business transfer risks to a third party.
In fact, normal interruption policies only compensate for damage to your own property, not a third party.
You might ask why it is important in the age of COVID-19. Remember that your business often will not be affected directly by the disease, but any damage to other businesses in your supply chain can also impact your operation.
That’s where the CBI will come into effect. It’s an extension of business interruption insurance that covers losses of your customer or supplier from an interruption of business like lockdowns.
This is of paramount importance during the COVID-19 pandemic because even if your business is not vulnerable, your supply chain is likely to endure interruptions.
For example, many workers in crowded areas are infected, and governments have forced the manufacturers to close. So your business will not be able to continue its operation without access to those companies’ productions.
Cyber Insurance
One of the most important effects of COVID-19 is the rise of remote working. The internet and communicating apps are playing a vital role in the performance of companies.
As the number of remote workers increases, cyber-security problems are significantly increasing, and businesses’ sensitive data, including payment information, are at risk.
Fortunately, many insurance firms have some policies to cover damages concerned with cybercriminals.
You can reduce the first-party risk and third-party claims in this regard and prepare your business to get through this crisis.
Event cancellation
This is another type of business insurance that might be helpful in the age of the coronavirus.
As you know, many events have been canceled since the outbreak of the new version of coronavirus. As a result, many businesses might have faced a financial loss. Purchasing even cancellation insurance can be a prudent decision these years.
Remember that many policies will not include cancellations that occurred because of viruses or contagious diseases. Try to make sure if the policy you’re buying covers such conditions.
Liability concerns
COVID-19 has caused the deepest liability concerns in recent decades. For example, many employees, guests, customers, or clients, might complain that they will be sick due to your business negligence at work.
General liability insurance protects your business when you’re liable for property damage, personal injury, or any other losses.
It can offer you costs related to personal injuries, damage to third-party property, medical expenses, and some other conditions.
When you want to claim for a cost due to COVID-19, they will ask you to prove that you’re infected due to negligence at work. You’d better make sure if the lack of emergency medical equipment or other necessities can be included in this type of business insurance.
A specific type of this insurance will benefit stakeholders who might claim that the manager has not developed enough contingency plans for COVID-19, causing a significant loss. In this type, body injuries will not be included.
Bottom line
The outbreak of the coronavirus has caused many health and financial issues. Of course, those businesses that had already started using digital technologies faced the minimum losses. If you’ve experienced a reduction in your revenue, you should claim business insurance to compensate for it. Remember to make sure about the details of insurance policies and then apply for them.
