There’s a lot that goes into the lengthy paperwork you sign when purchasing an insurance policy. And there’s a reason the policies are so long and contain so many sections. Insurance companies are looking out for their own best interests. But with COVID-19 insurance claims on business interruption insurance policies, things just took a turn.
We are a team of attorneys helping Florida homeowners and small businesses with settling claims. So we know all too well the great lengths insurance companies will go to avoid paying claims. After all, they’re for-profit companies, in the business of satisfying shareholders and fattening investors’ wallets. So it’s no surprise that they’re using any means necessary to avoid paying claims. Following are typical policy exclusions:
Acts of God.
Acts of war.
Or in this case, Exclusion due to loss from virus or bacteria—a term insurance companies were quick to add as an exclusion following the SARS outbreak of 2003.
Insurance companies dealing with COVID-19 insurance claims have been consistently finding ways around paying out claims, despite the premiums paid by policyholders, including this pandemic.
Recently, though, President Trump stated, “You have people that have never asked for business-interruption insurance, and they’ve been paying a lot of money for a lot of years for the privilege of having it,” Trump said. “And then when they finally need it, the insurance company says, ‘We’re not going to give it.’ We can’t let that happen.”
Why insurers need to pay
Insurance companies are claiming they don’t have the resources to cover all the claims they expect to receive. And it goes beyond simply not having the funds to pay out each policy.
An attorney representing a major insurance company made this statement with regard to COVID-19 insurance claims:
“Resources are stretched when we have a large hurricane. So imagine having to send out adjusters to adjust claims over the entire country,” he said. “The insurance industry doesn’t have the resources to do that.”
While the case can certainly be made that these would be difficult times for the insurance companies, our first thought is to flip the script. Ask the insurance companies what would happen if things were the other way around. What would happen if a small business had an issue with making their premium payments? Would the insurance provider be empathetic?
It’s highly doubtful.
So then why are policyholders expected to shrug their shoulders? Even worse, why are they continuing to pay their premiums even after being denied—albeit higher premiums since they filed a claim?
What the denial of COVID-19 insurance claims means
While no one could have expected a pandemic that swarmed upon us like the recent coronavirus, big insurance companies were prepared just in case.
As mentioned above, many property and commercial insurance policies have terminology written into their policies. This protects them from severe catastrophes. And a pandemic was an idea that many insurance companies were unexpectedly hit with in 2003 when the SARS epidemic took place.
Luckily, SARS didn’t turn into nearly the outbreak the coronavirus has turned into. But the insurance companies held their breath anyway. The idea of what we’re seeing now with COVID-19 insurance claims was the worst nightmare for insurers in 2003 when the SARS outbreak took place, but they narrowly escaped. And when they did, they began underwriting exclusions into their policies like the Exclusion due to loss from virus or bacteria one that exists in most policies today.
But business owners weren’t expecting the outbreak. Small businesses that thrive off of foot traffic, daily sales, and the help of employees to get through each day weren’t expecting this. So when it all came crashing down due to mandatory government shutdowns, they only had one place to turn.
The one place they knew to go was to the one place that told them We’ve got you covered if anything happens. But then that place slammed the door shut as small business owners came knocking and looking for their end of the bargain to be upheld.
Businesses have closed. Loans have gone unpaid. Employees let go. Stimulus checks have barely kept people afloat. Yet insurance companies still refuse to pay out on COVID-19 insurance claims on business interruption insurance policies.
But their party is about to come to an end. No longer will they be able to act in bad faith.
What to do if your COVID-19 insurance claims are denied
Business owners aren’t willing to sit back and allow insurance companies to get away with throwing their hands in the air. They aren’t letting them claim they can’t handle the COVID-19 insurance claims. Small businesses need answers. More importantly, they need the financial compensation they’ve been paying premiums for.
Thomas Keller, the famed chef-owner of restaurants Per Se, The French Laundry, and Bouchon, among others, has filed a lawsuit against his insurer after having a claim denied.
“We need insurance companies to do the right thing and save millions of jobs,” Keller said in a press release.
And the point he makes only solidifies the idea we’ve mentioned earlier in this article. Insurance companies are looking for the largest profits and are willing to sacrifice the job security of millions to ensure their investors and shareholders are happy.
Small business owners across the country are starting to feel the effects of being denied their COVID-19 insurance claims. They are growing more and more skeptical of the ethical standards of their insurance companies.
If you fall into the category of an individual or business owner who has been denied a claim by your insurance company, you aren’t stuck without any options. Although Thomas Keller is getting attention for his lawsuit based on the fame of his companies, it doesn’t mean he is only able to do so because of his name. Anyone with an insurance policy has a voice.
If your business interruption claim has been denied, there may still be legal ways to fight it. At RRBH Law, we’re ready to stand beside you and fight these insurance companies.
Call us today for a free business interruption insurance policy review. We’ll help you receive the payout you deserve on your COVID-19 insurance claims: 305-800-4663 (HOME).