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Business Interruption Claims Reporting Procedure and Loss Documentation Resulting From and/or Related to Impact From COVID-19

The impact of COVID-19 on American businesses has increased dramatically over the last several weeks as state and local governments order mandatory shut-downs and ‘shelter in place’ orders, further complicating operations for businesses already impacted by COVID-19. The insurance industry’s response to these issues, will be impacted by potential external pressure from legislatures, courts and public opinion. We do not know how the insurance carriers will react to this external pressure, and whether it will impact their claims determinations. To be clear, nothing has changed with our interpretation of the policies. The likelihood of triggering Business Interruption coverage without a physical loss is going to be an uphill battle, but due to pending legislation in many states (Massachusetts, Ohio, New Jersey) rumors of pending legislation at the federal level, declaratory judgments being filed, and the possibility of future class action suits, there are now enough extraneous factors that it is prudent for many of our clients to file claims because of this uncertainty.

Recommended Claim Filing Process:

Due to the potential high volume of claims filing anticipated in the industry, the most expedient method to submit a claim is through direct filing. Please follow the recommended claims process below and feel free to reach out to or your dedicated Harmon Dennis Bradshaw Service Team if you have any questions.

  1. Check the attached list of carrier claims reporting emails for your property carrier. If you do not know who your property carrier is and/or you do not know your policy number, please reach out to your HDB Service team.
  2. Prepare an email to your carrier’s claim reporting email with a CC to Use your policy’s First Named Insured and policy number as the Subject line.
  3. Include this statement in the body of the email. Feel free to copy and paste this language into your email.“
    1. Please consider this communication as notice of a claim under the above policy for business interruption/income losses resulting from the COVID-19 pandemic and losses related to government mandated shut down, lack of access and potential contamination of locations.”
  4. Include the following information
    1. Loss Locations – All locations or a list of location that have been affected
    2. Insured contact and contact info (phone number and email address)
  5. Send email to the insurance carrier claims email with CC to We will document and track insurance carrier responses so please forward any response you may receive directly from the carrier.
  6. Follow the steps described below for documenting your losses in order to provide a follow-up claim documentation submission directly to your insurance carrier claim handler.

Timeline of Potential Loss and Type of Loss:

  • Prepare and maintain a timeline of impact to business, including impact on revenue, various percentages at capacity, impact to specific customers (including dates, amounts, etc.).
  • Keep track of dates of project slowdowns or complete shutdowns.
  • Obtain civil authority orders, local or otherwise, of shut down – get copies of signed orders
  • Log and track all impacts to employees and workforce – Lay off, RIFs, working remotely
  • Track key operating statistics, including production and capacity statistics, sales price and rate data, materials cost increases.
  • Provide payroll allocations with a separate code regarding paying people without work
  • If possible, find any known individuals that may have been inside the property that contracted COVID-19 (adds strength to physical damage claim)

Loss of Business Income/Loss of Rents:

  • Keep track of cancellations (day passes/ongoing memberships)
  • In addition to keeping track of cancellations (above on the list), including cancelled or delayed customer/sales orders, delayed events, customer complaints, returns, penalties that the client’s business might have incurred, loss of key employees, operating hour impacts.
  • Determine if feeder or dependent properties (supplier, customers, attraction properties, that may have had a COVID-19 illness) impacted loss of income
  • Gather and track financial records, including tracking revenues year over year to show impact on loss of business, copies of all contracts for affected customers
    • Copies of income tax returns for the two years immediately preceding the date of impact
    • Profit and loss statements for two years immediately preceding the date of loss.
    • Copies of leases for building and/or equipment
    • Daily sales for the months of the preceding year which corresponds with the period of impact.
  • Continue to book all depreciation
  • Continue to book corporate office allocations/charges to individual locations to include as continuing expense
  • For Hotel/Motels, keep detailed occupancy records for the two years preceding the loss showing daily, weekly or monthly room/nights rented.

Extra Expense – Extra Expense means reasonable and necessary expenses to avoid or minimize the suspension of business and to continue operations at the described premises, expenses to minimize the suspension of business if you cannot continue operations and expenses to repair or replace property.

  • Copies of all expenses and backup for all expenses incurred to respond or deal with issues related to pandemic (e.g., renting extra space, storage, cleaning costs, increased utility costs, etc.). Advisable to charge all operational expenses incurred due to COVID-19 situation to a separate general ledger account. Document all costs related to same, including temporary labor, overtime, spoilage, advertising, protective equipment, IT equipment for remote work contract penalties, other purchases, security, legal fees, transport expenses.

COVID-19 has given rise to global concerns about the impact on business operations.  In the coming weeks, as your attention shifts to assessing the impact on your business, you will undoubtedly turn to your insurance coverage and prepare to submit an insurance claim.  We want you to know that HDB has proactively assembled a team of specialists to address your questions about your coverage and assist you with the claims process.  We are confronting uncharted territory and there remain many unknowns including how the insurance market will respond to the unprecedented number of business loss claims that are anticipated.  The available information continues to evolve, and our team is actively monitoring government orders and legislation, claims determinations by insurance companies, and decisions issued by courts.  While it is the insurance company that will ultimately respond to your claim and decide whether you have coverage, HDB will assist in any way that we can.   

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