Covid-19 Crisis FAQ's
For information about Business Interruption Loan Schemes (CBILS), visit:
Other useful links and resources include:
Unfortunately, a standard business interruption policy does not cover you for the losses relating to the impact from COVID-19. The standard cover is designed to respond to losses due to damage to property following say a fire or flooding.
Unfortunately, a standard business interruption policy does not cover you for the losses relating to the impact from COVID-19. The standard cover is designed to respond to losses due to damage to property following say a fire or flooding. You may however have cover provisions under certain policy extensions if you have them:
- Notifiable Diseases
- Denial of Access (non-damage)
- Action of Competent Authority
Operation of cover will however be dependent on the wording of these extensions which vary from insurer to insurer, and the individual circumstances that apply.
Many policies will specify the ‘Notifiable Diseases’ that are covered. Unfortunately, as COVID-19 is a new disease it is unlikely it will be specified in any policy.
Some policies will allow for ‘Notifiable Diseases’ which have been newly declared under the Health Protection Regulations. In which case the cover may apply, but once again this will be subject to the individual wording and circumstances.
Many ‘Prevention of Access’ wordings will specifically exclude actions to suppress and/or control the spread of a disease.
The standard cover is designed to respond to losses due to damage to property following say a fire or flooding.
Many ‘Prevention of Access’ wordings will specifically exclude actions to suppress and/or control the spread of a disease.
The standard cover is designed to respond to losses due to damage to property following say a fire or flooding.
Following the Government announcement, we are yet to hear from Insurers outlining how they intend to respond to business interruption claims relating to COVID-19.
Many extensions of this nature will specifically exclude actions to suppress and/or control the spread of a disease.
You should do all you would do to keep the business operating; act in the same way you would to protect the business if you did not have insurance to rely on.
Keep detailed records of the reduction in income and increased business expenditure.
You should then speak to your usual representative for guidance on the presentation of your claim.
Unfortunately, you will not be able to purchase an additional policy for this event.
Most policies will not respond to this as a trigger for business interruption cover, unless specific extensions relating to pandemic have been added.
Reference does need to be made to your policy for full terms, conditions and exclusions as this will differ depending on insurer, but the overall position is that your policy may respond in two different areas if the policy has ‘Denial of Access (non damage)’ and ‘Notifiable Disease’ extensions:
- An outbreak of a notifiable disease at the premises.
- Denial/Prevention of access on the advice of government, police or local authority.
Note that COVID-19 disease became notifiable on 05/03/2020 under the relevant English statutory instrument.
It is only the contractual loss of rent that would be covered by the policy. If tenants simply suspend rent payments themselves this would not be covered nor would the Insured’s (landlord) decision to reduce rent on the part of tenants or a decision to provide a discount.
In normal circumstances, a standard lease will allow for rent suspension in the event that the property is destroyed or damaged by any insured risk [or uninsured risk] so that the premises are unfit for occupation or use or inaccessible.
The situation is changing rapidly and we can only advise based on individual policy wordings.
Many policy wordings will contain unoccupied premises clauses. It is important that you notify your usual representative of any closures and provide details of the measures that you are taking so that we can engage your Insurer. A number of insurers are being proactive in this regard, please refer to our insurer update section or speak to your usual contact.
Most policies will not respond to this as a trigger for business interruption cover, unless specific extensions relating to pandemic have been added.
As a general rule, you will be covered under your ‘Public Liability’ insurance, subject to the undertaking and documenting of a risk assessment that clearly shows suitability of your workplace. This should consider things like:
- Has a specific risk assessment of your business been carried out i.e. is it suitable for their children to access?
- Have the relevant checks been made for any staff members (if applicable) i.e. the suitability of those undertaking the supervision of their children?
- Have you followed current Government guidance i.e. around any staff / visitor exposure to the virus, self-isolation and third-party visitors to their premises?
- Has a risk assessment been undertaken on the suitability of the area where their children will be?
Do you have premises?
If you own or rent premises then you could still be liable for damage or injury caused by the property. For example, if a roof tile should come down and injure someone, you would be liable.
Do you own your premises?
You will still need to cover the rebuild and accidental damage risks that the premises is liable for.
Do you lease your premises?
Have you checked your lease agreement to understand what liabilities you hold to your landlord? You may contractually and therefore be legally responsible for insuring all or part of the premises.
Do you intend to offer a different service to customers?
For example, we’re starting to see many traditional pubs now offering a delivery service to their communities. This means that they will have employees, they will be visiting customers and they will be holding stock. You will need to check with your usual contact whether your public liability, employers liability, stock and property covers are all adequate.
Will you still be holding your current stock?
This stock is still at risk of theft and damage. In the event of a flood, theft, or escape of water ‒ could you cover the cost of re-stocking your entire business?
Are there any residual liabilities connected to work previously carried out?
Some covers require continuous coverage to remain suitable where claims can occur sometime after work was carried out. It is important to keep cover active.
If out of inspection, the plant cannot operate or be used.
Yes. We have taken appropriate steps to protect our team whilst also remaining available for our clients.
Please contact your usual contact, email is preferable at this time, however, our main phone number is being re-directed.
Please be assured that we will issue your renewal as normal and will send out all relevant documentation. If you would like to discuss your renewal once you receive your documentation, then please contact your usual contact.
There will be individual circumstances in the event of a claim. However, the latest government advice can be found here…
Most policies will not respond to this as a trigger for business interruption cover, unless specific extensions relating to pandemic have been added.
Please refer to your policy information which details how best to make a claim and contact your usual contact.
We would recommend you do the following:
- Please ensure that you comply with all relevant Government advice. If you are continuing to trade, you should act to mitigate any potential losses and operate as if you are not insured.
- Keep detailed records of any reduction in income and increased business expenditure.
- Gather as much documentation as possible to support a potential claim including documentation from suppliers who may be unable to deliver, and evidence of mandated government closures.
- Gather information in relation to any outbreak on the premises if applicable but be mindful of any data protection requirements in this situation.
We can offer you an instalment plan through our provider Close Brothers. This will allow you to spread the cost of your payments over a number of months and can be set up electronically with your consent.
Coronavirus update
Following our update on 27 March, we wanted to provide you with a further update on how Close intend to support customers who may be experiencing financial difficulties during this uncertain time. Our approach is as follows:
Reminder for Commercial Lines customers
• Up to 3 months payment holiday at 50%
• Depending on the instalment profile, the shortfall will be paid by extra payments in the following month(s) e.g. if the customer is on a 10 month profile, there will be an extra full payment in month 11 and a 50% payment in month 12
• Default fee waived
Updated Bordereau customers
• One month payment holiday, or customer has the option of having two payments at 50% payment
• The payment will be spread over the remaining instalments
• Where there are no instalments remaining, the last chance payment date will be extended by 30 days
• Default fee waived
We will also be ensuring that any customers that do end up cancelling their finance agreement are not charged a cancellation fee.
Customers who have already been offered support
We do understand that some customers may need additional support even after we have granted them an original payment holiday. Depending on individual circumstances e.g. key workers still needing their vehicle, you may choose to offer additional support to some of your customers, we would encourage you to consider what is best for the customer on a case by case basis.
How can my customer apply for payment support?
For UK customers who have been financially impacted as a result of Coronavirus, and have not yet received financial support from us, the easiest way to apply for payment support is by completing a form on our website
www.closebrotherspf.com/coronavirus/customers
The majority of requests from personal lines customers will be processed automatically and for commercial lines, these will be referred to our Credit team for review.
How you can contact Close
For UK customers, please encourage them to complete the payment support form, however, if they wish to speak to us, they can still contact our team on 0333 321 8566.
Please note you will experience longer than usual wait times when contacting our customer contact centre. We apologise for any inconvenience this may cause.
If you have any questions or concerns, please contact us.
The Association of British Insurers (ABI) have said that clerical workers do not need to notify Insurers. However, to be safe, if you are doing more than office work or have taken a lot of expensive equipment home with you, it’s best to check with your usual contact.
