Commercial Property Insurance Coverage - Small Businesses May Have Valid Policy Claims
This brief article is intended to provide a very general overview of potential business coverage for small businesses having suffered losses as a consequence of the coronavirus, COVID-19 and/or SARS-COV-2 pandemic.
If you own a small business and your business has been adversely impacted by the pandemic (and who hasn't), your property insurance may be liable for some of your losses. For instance, some policies include "civil authority coverage". Civil authority coverage generally covers the insured business for losses arising from mandated closures of one's business as a consequence of governmental authorities prohibiting access to business premises.
For instance, in Beverly Hills, California, where Benjy Law Corporation is headquartered, the City and California government authorities have mandatorily shut down beauty salons, nail salons, gyms, etc. Restaurants and coffee shops have been mandatorily forced to only allow for pick-up and take out (or delivery), which undoubtedly has resulted in many tens of millions of dollars of losses to their bottom line. If these businesses have commercial property insurance with certain coverages, these businesses might have a legitimate claim on their policies for a substantial portion of their losses.
In addition to civil authority coverage, other coverages may also apply - including business interruption coverage. In any case, a legal analysis of the specific facts and circumstances is necessary and appropriate before proceeding with making a claim and filing a lawsuit against the insurer (should that be necessary).
Any delay in making your claim or taking action can unintentionally have serious and devastating consequences for the insured party's rights. So treat these sorts of issues as extremely time-sensitive. The sooner you act, the more likely you will be to have a chance of recovery.
Insurance companies will fight such claims tooth and nail, for obvious reasons. They don't want to pay out a dime. If they begin to honor these claims, they will be on the line for devastating payouts to many tens of thousands of businesses. In fact, they have already made noises about no coverage for these circumstances in hopes of preemptively discouraging such claims.
Knowing the foregoing, if your small business has suffered losses as a consequence of the pandemic, you owe it to yourself to have a law firm analyze your policy and policy endorsements and counsel you on your rights. To the extent that policy coverage may exist, you are often much better off making a claim using legal counsel than trying to navigate the treacherous shark infested insurance waters on your own. The sad truth is that many insurance brokers will instinctively tell you that you have no coverage and to not even bother. For those of you who do make claims on your own, the insurance companies will almost certainly deny those claims and call you on your "bluff" (basically daring you to sue them for bad faith denial of coverage).
However, if you proceed with careful analysis and approach utilizing legal counsel, your claim will likely be taken more seriously. After all, if you were smart enough to retain legal counsel first and ask questions later, you are much more likely to pull the trigger and file a lawsuit seeking punitive damages for bad faith denial of coverage.
Benjy Law Corporation invites you to call and consult concerning such claims. If we analyze your policy and determine that you may have coverage, we may agree to take your case on a strict contingency basis - which means that we will only earn a fee if you prevail and recover.
Please call us at (310) 203-2650 and ask to speak with an attorney.