What is BI Insurance?
BI Insurance covers losses which result from closure of business. BI Insurance is usually part of a commercial combined policy.
What does BI Insurance cover?
If cover exists:
- loss of income;
- fixed costs such as: payroll, operating expenses and business loan repayments; and
- costs of temporary relocation.
What circumstances give rise to a claim?
There is uncertainty as to how to classify Covid-19 and which BI Insurance provisions cover losses sustained due to Covid-19. There are generally two types of clauses to look out for which may cover losses:
- Disease related interruption
- usually requires Covid-19 to be a specified disease (unlikely) or a notifiable disease (as of 5 March 2020, Covid-19 is a notifiable disease); and
- Action by Government, Police and/or Local Authorities
- typically requires Government to take hard enforcement action and make it illegal to keep businesses open instead of only recommending to shut businesses.
What should I do now?
- check your insurance policy and establish whether you have BI Insurance cover;
- gather evidence of your business interruption and extra expenses incurred due to Covid-19; and
- notify your insurer of a potential claim – if in doubt as to the extent of the notification requirements, provide as much information as possible to support your position.
If you would like to talk to someone about your BI Insurance challenges or enlist our assistance in pursuing a claim against your insurance company, please contact Alexander Wildschütz, Bree Taylor and Nadia Osborne.