Commercial property insurance policies also require a physical loss or damage to tangible property to trigger coverage.
For insurance policies without a virus exclusion, COVID-19 coronavirus coverage may turn on the definition of physical damage. If a property has become physically contaminated and uninhabitable or unfit for occupancy due to the coronavirus, a viable claim may be made that a direct physical loss has occurred and, for example, the cost to thoroughly sanitize the property is covered. Indeed, many state and local orders shutting businesses have specifically cited property damage from the coronavirus pandemic as one of the underlying reasons for shutdowns.
Even in situations involving policies with a virus exclusion, a claim may still potentially be made as several courts have found that where a condition, such as an odor or harmful substances in the air or on surfaces, makes property unusable or uninhabitable for its intended purpose, there has been direct physical loss or damage to property.
Nor in the case of dangerous conditions—such as the COVID-19 pandemic—would it make sense to wait for the coronavirus to visibly manifest itself in order to trigger commercial property insurance coverage. In light of the scope of the global pandemic, no rational insurance carrier could (or should) insist that in order to trigger coverage, a restaurant, hotel, or retailer must stay open until the coronavirus can be definitively established on the premises since it is virtually certain that would happen and customer lives would be at risk in the meantime.
Commercial property insurance is intended to both protect against risks and compensate your losses. Time is of the essence. Contact us today. Our goal is to recover all of the lost profits to which you are entitled under your policy.