COVID-19 FAQs

Last Revised: March 27, 2020 | 5:00PM EST

As an agency dedicated to serving small businesses, we understand all too well that COVID-19 is affecting our communities all across the country.

We know that you have questions about your business insurance in these uncertain times, so we’ve pulled together this FAQ to help address some common concerns. But as we all know, this is a fluid and ongoing situation, and things can change quickly. We’re in touch with our insurance carrier partners, and we’re monitoring the industry and government responses very closely. We will update this FAQ page as we have new or amended information to share.

We hope that you, your employees, and your families are safe and healthy as we all work together in these extraordinary circumstances.  Contact us if you need us.

Q: Will my workers’ compensation policy cover me for COVID-19?

A: Workers’ comp policies include language about coverage for employees when employees are unable to work after contracting a work-related disease particular to the workplace. An important consideration is: did an employee who unfortunately contracted COVID-19 do so in the course of their employment? In these cases, the burden is typically on the employee to prove the occupational nature of the illness.

Additionally, if your employees are out of work, it’s important to consult your disability policy. Note that some states are waiving the waiting period for coverage to begin for disability and unemployment benefits.

Q: Will my business owner’s policy (BOP) cover me for COVID-19?

A: Most BOPs require that coverage for lost income due to business interruption be caused by direct physical damage to property — for example, the property damage resulting from a fire. Also, most BOPs specifically exclude damage from a virus. 

“Civil Authority” actions can trigger business interruption coverage, such as when a local government forces the temporary closure of a business after a water main break, but the same tests for physical damage and the same language would still apply around damage from a virus.

Previous virus outbreaks have informed how the insurance industry handles these scenarios, but things can change quickly. For instance, following the terrorist attacks on 9/11, the Federal Government stepped in to enact a new terrorism protection program. 

In our current situation, Congress has recently announced new legislation to address lost business revenue. We will be monitoring its progress closely to see if business interruption can be covered for COVID-19. Also, for those that qualify, the federal government is increasing the amount of small business loans available to help offset some of the financial burden.  

Q: Will my general liability policy cover me for COVID-19?

A: We’ve heard questions from businesses about their general liability coverage, including a concern about patrons of a store claiming they contracted COVID-19 while in that store, or about customer exposure to the virus from shipped goods. 

Generally for a claim to be successful, the claimant has to prove legal negligence. We have not yet seen any claim decisions based upon legal neglect and the COVID-19 virus, but we’ll be watching closely.

Q: What should I do if I have sick employees, lost revenue or other damages that I believe should be covered by my insurance policies? 

A: Submit a claim to your insurance carrier. As insurance agents, we’re here to help you understand the claims process and to act as your advocate, but we don’t decide the outcomes of claims. Insurance companies pay claims per the terms of the insurance policy.

Q: What if my business is having cash flow issues?

A: The insurance companies we work with are extremely understanding of the crisis affecting businesses, and they’re taking immediate steps to help keep coverage intact. The facts and remedies vary by policy type and insurance carrier, so ask about your options. Contact us to discuss how we can assist.

UPDATE (3/25)
Q: Ok, what are some ways I can help my cash flow?

A: You may be able to get some cash flow relief by switching from a traditional workers’ comp policy to Pay As You Go workers’ comp, even if you are mid-term in your current policy. If you are a payroll customer of one of AP Intego’s payroll partners, we may be able to switch you over. If so, you could receive a lump-sum refund of your premium for the unused portion of what you paid up front, and then pay only the premiums required based on real-time payroll levels, which are likely reduced at this time. Ask your payroll provider if they are an AP Intego partner.

UPDATE (3/25)
Q: I’m already a Pay As You Go workers’ comp policyholder and I’m not able to to run payroll at this time due to COVID-19. Will my policy be cancelled?

A: No. We have put checks in place to keep your coverage active. Your policy will not be cancelled. We met with all of our Pay As You Go partner insurance carriers. All are supporting us to keep our customers’ coverage intact at this time. If you inadvertently receive a cancellation notice you should contact us immediately and we can provide written proof of coverage. You can email support@apintego.com (preferred) or call 888.289.2939 (we’ve activated a call-back feature to help with wait times).

Q: I’ve temporarily shut down. Should I cancel my policy?

A: No. Contact us and let’s review your options, as you may have employees, property, or ongoing liability of some kind.

Legally, in most cases if you have employees you need workers’ comp. Remember that the premium you pay for a workers’ comp policy is mostly based on your payroll level. If you have a Pay As You Go workers’ comp policy and your payroll is down, you will pay less in premium. Either way, let’s work together to keep your coverage in place, including by using the payment and reporting flexibility offered by the insurance industry during these trying times.

NEW (3/27)
Q: What is the CARES Act?

A: It’s the “Coronavirus Aid, Relief, and Economic Security Act” (CARES). Phase 3 of the Act, signed into law by the President today (3/27), is a massive $2 trillion economic relief package that includes extraordinary public health spending to confront coronavirus, immediate cash relief for individual citizens, a broad lending program for small business, and targeted relief for hard-hit industries.

NEW (3/27)
Q: How does Phase 3 of the CARES Act affect my insurance coverage?

A: For small businesses who are affected by the COVID-19 crises, the most relevant part of the legislation is the provision for loans that will help businesses pay for, among other expenses, insurance premiums — both healthcare insurance premiums and property & casualty premiums, such as workers’ compensation and liability insurance. 

Loans will be available for businesses with 500 employees or fewer in which “uncertainty of economic conditions makes necessary the loan request to support ongoing operations.” Therefore the funds may also be used for other expenses impacted by the economic crisis, including your payroll, mortgage payments, insurance premium payments and employee benefits. Notably, the loan can be forgiven if the proceeds are used for many of these expenses. There will also be no requirement for personal guarantees or collateral, and you don’t have to demonstrate that you were denied credit elsewhere. Loan amounts are up to 2.5x a company’s average monthly payroll, capped at $10 million. It’s not yet clear how you can apply for these loans, but it’s likely to be through your bank. Here is a helpful loan provision guide and checklist from the US Chamber of Commerce.

NEW (3/27)
Q: Will the states and/or the Federal Government enforce coverage of business interruption?

A: It doesn’t seem likely for existing policies. There is legislation in various preliminary stages in several states, but it’s probably just to put pressure on the Federal Government. It’s unlikely to pass in the states. If it were passed, it would be met with immediate legal action by the insurance industry, and experts feel a state mandate would be unconstitutional. 

Looking forward, there are active discussions underway at the Federal level to provide coverage for business interruption caused by the economic slowdown from COVID-19. We will be watching this process closely.

Q: I still have questions, what should I do?

Don’t hesitate to contact us or your insurance carrier. We’re all in this together.

We’re here to help.

Copyright © AP Intego Insurance Group, LLC, 2019

CONTACT US

Call: 888.289.2939
Fax: 888.289.2988
Email: info@apintego.com

LOCATIONS
1601 Trapelo Rd. | Ste 280
Waltham, MA 02451
375 Woodcliff Dr. | Ste 103
Fairport, NY 14450
3825 Hopyard Road | Ste 180
Pleasanton, CA 94588
201 Columbine St. | Ste 300
Denver, CO 80206
CONTACT US

Call: 888.289.2939
Fax: 888.289.2988
Email: info@apintego.com

LOCATIONS
1601 Trapelo Rd. | Ste 280
Waltham, MA 02451
375 Woodcliff Dr. | Ste 103
Fairport, NY 14450
3825 Hopyard Road | Ste 180
Pleasanton, CA 94588
201 Columbine St. | Ste 300
Denver, CO 80206

Copyright © AP Intego Insurance Group, LLC, 2020