Government-ordered closures of restaurants, stores and other businesses because of COVID-19 are not enough to trigger coverage, insurers say

As the frantic queries for financial help came flooding in following the coronavirus shutdown orders, Holly McGlinn speedily assembled a spreadsheet to help her track the now 125 claims — and counting — for coverage of business losses sought by her insurance agency clients.

“I’m filing as fast as I can,” said McGlinn, whose firm, Breakwater Strategic Insurance Solutions that she owns with her husband Ryan, represents a broad swath of local businesses — restaurants and bars, event planners, retailers, pilates studio operators, and tech companies.

So far, all the responses have been the same — denial of coverage.

Despite a still rapidly expanding coronavirus pandemic that has financially ravaged businesses locally and across the nation, companies are quickly finding out that their property insurance policies, which include protection against the interruption of business, simply don’t apply in the world of COVID-19.

In many instances, claims are rejected because the policies include a specific exclusion for losses due to “virus or bacteria,” a legacy of the SARS outbreak of the early 2000s. Insurance company adjusters are also citing a more nuanced explanation, namely, that the shuttering of businesses due to coronavirus was not related to nor did it cause actual property damage, as in the case of a fire or hurricane.

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