The Covid-19 pandemic is unlike any crisis business has ever faced. Our world has changed so drastically, in just a short period of time. We all find ourselves in unchartered waters, but business owners are a resilient group, and we can get through this.
Amid concerns over our health, jobs, and the economy, people want to know what help is available. And while the insurance industry has a long history of helping families and communities rebuild in difficult times, business insurance was never designed to cover a global pandemic.
There are steps you can take to help you weather this storm.
- Delay Payments. Insurance carriers are open to conversations regarding delaying your current insurance payments. They understand that many businesses have been impacted and are open to finding a solution that helps you maintain coverage while postponing your payment.
- Adjust Policies. Many insurance policies are based on 12-month sales and payroll estimates. Your premium installments would be reduced by a decrease in the current payroll or sales estimates on your policies. Speak to your insurance agent about reviewing your current estimates and make the appropriate adjustments.
- File a Claim. While any business interruption claim will almost certainly be denied, we advise our clients to turn in a claim once they have suffered a loss. Pandemics/viruses are generally excluded from insurance policies, but it could be helpful down the road to be on record of your loss. It’s possible the government could assist in developing a solution to help backstop the insurance industry in some type of compensation program. Click here to read an article regarding the effort between the insurance industry and Congress. We suggest you start a file to track expenses associated with Covid-19, things like clean-up costs, lost revenues, etc.
- Guard Against Cyber. Businesses are more vulnerable now than ever with employees working remotely without the same safeguards as they have onsite. We have seen a significant uptick in social engineering claims. These attacks trick employees into changing the routing/transfer of outgoing funds – generally done by email. With more transactions completed by direct deposit – both to employees and to vendors – this is an increasing concern. Most policies do NOT provide this coverage making it important to review with your agent.
- Track Excluded Payroll. If you have employees that are not working but that you continue to pay, you will NOT need to include this payroll in the calculation of your workers’ compensation premium. You should keep good records so, at the annual workers’ compensation audit, you can identify these expenses separately from normal payroll. Click here for an article on the change.
- Sign Up for the PPP. I’m hoping you’ve already seen the information regarding round two of the SBA’s Paycheck Protection Program – click here if not. This program provides a forgivable loan for up to 2.5 x your average monthly payroll, not to exceed $10 million. These funds have proven to go quickly. You should contact your bank immediately or connect with a local bank to complete the process.
While the above are six areas to review right now, I’m sure the list will grow and change with time. If there is one certainty of our current situation – it’s the certainty of not knowing what will come next.
For those looking for some specific help and resources, we’d like to offer access to our Risk Management Portal. The Portal has a wide variety of industry-specific resources, with many attorney-created documents that are easy to search and edit specific to your business. While Covid-19 is front and center, there are many additional issues and subjects covered as well. Just drop your name and email and we’ll provide you a link to gain access.
I know this is a scary time and I know many businesses have been disrupted but we will all get through this together.
I hope you, your team, and your family stays safe and healthy!