As a business owner we hope to never have to rely on our business interruption insurance but when a major incident happens, not having coverage can present an existential threat. Small businesses and startups without substantial cash on hand are particularly susceptible.
Unfortunately most insurance policies for business interruption are based around physical damage from a storm or natural disaster--not an epidemic.
With the spread of COVID-19 increasing here in the U.S., and public health initiatives shifting from containment to mitigation, the risk of further disruption to your business is no longer academic. Markets are already quickly approaching bear territory and supply chains and consumer behavior is being impacted. The possibility of restricted travel and quarantine may have disastrous consequences for businesses.
The only thing worse will be realizing after the fact that you don't have proper coverage. If you're a business owner reading this, now is a good time to check your business interruption coverage.
“Now, quite honestly, we probably have a six-month backlog in getting quotes out,” said Christian Ryan of the risk advisory firm Marsh, which is brokering the policies in partnership with Munich Re and Metabiota, a data analytics firm. It’s too late to buy coverage for the current outbreak — “We can’t insure a burning building,” Mr. Ryan said — but the daily drumbeat of news about the havoc wrought by the coronavirus in the highly integrated global economy has many executives focused on how they can protect themselves next time.