In March 2020 the COVID-19 outbreak was declared as both a global pandemic and an insurance catastrophe by the Insurance Council of Australia. The question at the forefront of everyone’s mind, including business owners across not only the nation but the entire globe right now is, ‘will my insurance cover me for any loss incurred as a result of the coronavirus?’.

As the situation shifts and evolves so rapidly, not just by the day but by the hour, the extent of the losses and claims are still very much unknown, which means that unfortunately, no one can provide a definitive answer to this question at this moment. However, we have addressed a number of important updates and frequently asked questions below:

• An insurance industry taskforce has been set up as a result of the ‘insurance catastrophe’ declaration. This task force will monitor claims data and ensure that each industry is recording the right numbers and statistics.

• The task force will also ensure that stakeholders understand the position of their industry throughout the pandemic

What if I have business interruption insurance?

General business interruption insurance is unlikely to cover your business for a pandemic such as the Coronavirus. Traditionally, business interruption insurance has only covered disruption caused by direct, physical damage done to an insured property

What if my business interruption insurance also covers disruption from infectious diseases?

Some business interruption policies will cover the forced closure of business by an authority due to risk from infectious disease eg. Legionnaires. However, these policies generally only include outbreaks that are affecting small areas such as shopping centres or a particular building or store. A small number of policies will cover disruption from an outbreak which is up to 50km away.

Are there business interruption insurance policies which will cover me for the COVID-19 outbreak?

There are very specific policies that exist which may cover losses incurred by Coronavirus. However, in 2005 the global insurance industry introduced measures which excluded cover for disruption from a quarantinable disease or an infectious disease.

While there are exceptions and unique policies, most insurance plans in Australia will have an exclusion relating to any disease categorised under the ‘Biosecurity Act’. On March 18th, Scott Morrison officially declared a biosecurity emergency under the Biosecurity Act.

What are the possible exceptions which may be in my insurance plan?

Possible examples may be those policies which have inclusions written in for disruptions to crucial supplies from overseas or a drastic drop off in trade due to border closures.

Will I still be covered by travel insurance?

Most travel insurance policies have exclusions for outbreaks and/or pandemics meaning that you may not be entitled to compensation.

What if I was unaware of coronavirus when I made and booked my travel plans?

You may be entitled to assistance from your insurance company depending on the specifics of your policy and the provider. You should contact your insurance provider in this case to get specifics.

Some providers are offering assistance based on the time of booking in relation to when coronavirus became a “known event”. For most companies, the “known event” date is considered to fall somewhere between the 20th and 31st of January 2020.

What if I travel against government advice or recommendation?

You are very unlikely to be covered or compensated for coronavirus related travel expenses.

Am I still covered by my life insurance?

There are no exclusions on life insurance which may relate to COVID-19 or that could prevent your insurance company from paying out in the case of death caused by Coronavirus. If you follow all government advice, there is no need to be concerned about life insurance becoming void due to coronavirus.

At Allsafe Insurance Brokers, we are here to assist our clients in any way possible during this challenging time. To seek advice, get in touch with us today!