Cover In Times of Crisis
The spread of the Coronavirus has raised a number of questions regarding Business Insurance. In our new, fast changing and every evolving world, families, businesses and individuals find themselves in uncharted waters and ever increasingly difficult situations. As such we find ourselves being asked a number of questions regarding business insurance policies. The following article is aimed at answering some of these questions.
Standard Commercial Insurance
The vast majority of businesses will have a standard commercial insurance policy. These policies are designed to offer cover against a wide range of day to day risks, including damage caused by fire, flood, theft and accidents involving employees. Through these policies, insurers action claims of £22m each day.
Only a very small percentage of businesses choose to purchase cover that included closure due to an infectious disease.
Business Interruption Insurance
Business interruption insurance covers a business for loss of income during periods when they cannot carry out business as usual due to an unexpected event. Details of the perils associated to these events will generally be specified in the policy. The cover aims to replace certain losses sustained by the business during the period of the disruption.
Most business interruption policies only provide cover for physical damage that is associated to a named peril, such as fire, flood or storm. This will include damage to premises or equipment, and in some cases the breakdown of essential equipment as a result of the covered peril.
For those that have purchased a ‘notifiable diseases’ extension to their policy they will need to check the policy wording to identify whether only specified diseases are covered or whether there is a wider and more general policy wording. If it is the second case, then cover for business interruption due to COVID-19 may be possible.
Working From Home
Working from home, due to the need to self-isolate should be covered under standard home insurance policies, assuming that work is of a clerical nature.
If individuals are working from home and receiving business visitors to their home for business matters, they should check with their insurer as to what cover may be applicable. In some cases, there may be restrictions in cover such as loss of money or theft of property, unless there is evidence of forcible or violent entry.
Home insurance is unlikely to cover business equipment used. Employers would be liable to ensure that their equipment is covered when away from the office.
Managing Costs
As we all look to tighten our belts businesses look to see where they can save money. When looking to cancel or reduce insurance, individuals and businesses, need to think carefully about whether reducing cover could expose them to greater risk.
Before cancelling your monthly Direct Debit for insurance speak to one of the experienced, and helpful, brokers at Shearwater about the finance options we have available to customers. In most cases, support will take the form of waiving fees, temporary reduction in repayments, or a repayment holiday, thanks to our partnership with Close Brothers Finance.
To discuss your insurance needs further speak to a Shearwater Insurance today