Liability Insurance and Coronavirus (COVID-19)

As the cases for coronavirus continue, businesses (especially those in hospitality) should begin to look to their insurance policies to review the extent of their liability coverage. Why? There is a potential risk of liability by business owners who hold a level of responsibility for their guests, customers, vendors, and employees. This can include their overall health and well-being.

Commercial General Liability Insurance
Businesses could face claims or suits pressed by COVID-19 infected guests that they allegedly failed to take reasonable action to protect guests from infection or warn against the risk of exposure. These types of claims fall under bodily injury (exposure to harmful conditions) and are covered under a Commercial General Liability insurance Policy. Coverage typically extends to the cost of legal representation, mediation or arbitration, and any settlements awarded.

Worker’s Compensation
Similar claims of bodily harm caused by harmful health conditions made by employees are covered under Worker’s Compensation insurance. Normally, “ordinary diseases of life” are excluded from worker’s compensation insurance claims; however, if an employee can establish a direct connection of their infection to their workplace, they may have a valid claim.

Depending on the size of your business and/or industry, you may already have this insurance coverage because it is required by state law in order to operate your business. Where Worker’s Compensation may not cover a claim, having General Liability for your company provide coverage. Speak with your independent commercial insurance agent to discuss your coverage concerns.

Errors & Omissions Insurance Coverage
This type of insurance is particularly popular among the health care industry as well as other professional services where advice or recommendations may be given or highly relied upon. Errors and Omissions insurance is also elected by those whose direct actions or inactions could cause bodily harm (excluding employees, which would be covered under worker’s compensation).

This type of coverage would be used in the event bodily injury occurred to a third-party due to the advice/lack of advice or the action/inaction of a company, including but not limited to:
                     • Providing/not providing medical services,
                     • Misdiagnosis; lack of thorough testing
                     • Enacting/failing to set policy changes in response to the highly infectious disease
                     • Failure to follow recommendations set by government authorities

It is always best to continuously review your insurance policies and insurance needs to ensure they are matched as much as possible and to reduce the risk your company faces from claims. You can contact an independent insurance agent to help you review your current policy and help you to assess your insurance needs to ensure you have the right coverages and policy limits.