Does Business Interruption Insurance Cover Property Damage?

Many small business owners here in the greater Miami area have suffered financially through COVID-19. Particularly devastating is discovering that the business interruption insurance policy they thought would protect their operation has a pandemic exclusion.  

The purpose of business insurance is to provide income replacement during a period of business interruption due to covered causes in order to help the company remain viable and able to continue to pay operating expenses and other overhead costs until the company can resume business. 

Business interruption insurance is a valuable resource, but it only covers exactly what is written in the agreement and only for the time period or up to the dollar amount agreed upon. There are, however, opportunities for policyholders to appeal the insurance company’s definitions, that is, to argue that their particular circumstance falls under their coverage guidelines. 

Common coverage includes the following:

  • Fire damage to property, including smoke damage
  • Damage from wind or falling objects
  • Lightning damage
  • Coverage if an adjacent or nearby business experienced such damages, forcing your location to also close or become inaccessible
  • Theft 

Additional coverage is often available; for example, business interruptions due to:

  • Flooding or mudslides
  • Earthquakes
  • Terrorism
  • Civil authority

Business Interruption and COVID-19

Multiple suits have been filed across the nation and in Florida, attempting to get business interruption coverage for COVID-19 damages. Plaintiffs maintain that the virus has created real damage – some arguing that it is similar to smoke damage from a fire – mostly invisible, but requiring business shutdown and expensive remediation efforts to open again. 

Results have been mixed, varying greatly depending on the wording of coverage and the businesses of the plaintiffs, and many lawsuits are still in motion. 

Because of this, case law is not settled on this issue. In Florida, an ObGyn practice that had a virus exclusion in its business interruption policy was still able to win its case, as the judge determined that the language of the policy was vague. 

Other Business Insurance Coverage

There are numerous additional types of business insurance, some specific to a particular trade or profession. For instance, General Liability Insurance covers common business risks such as customer injury, customer property damage, and advertising injury. 

In addition to these protections, this insurance provides coverage against personal injury such as false arrest, detention, imprisonment, malicious prosecution, and being wrongfully evicted or barred entry. Most companies carry this insurance. 

Commercial property insurance, also commonly carried, covers the costs of repair or replacement of damaged, destroyed, or stolen business property, equipment, supplies, and inventory. 

Getting Help

If you, as a Florida business owner, have experienced personal or business injury that you believe should be covered by your insurance policy and you have not received what you consider to be fair compensation, or if you have been injured by a company or organization and have not received fair compensation, contact me today at (954)448-7288 with the details of your case. My mission as a Florida personal injury lawyer is to fight for the “little guy” against bigger players, and I have a track record of winning significant compensation for my clients.

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