Source: Colucci Law Group
Recently, a bill has been presented in New Jersey, which may be a template for change nationwide, if it passes in that state.
The bill, AB-3944, would require insurance companies to pay all coverage for business interruption due to “global virus transmission or pandemic” as stated in New Jersey’s executive interruption due to “global virus transmission or pandemic” as stated in New Jersey’s executive order, even if there is an exclusion in the policy for such pandemic. To protect insurance companies from financial disaster when tens of thousands of companies file claims, the act provides that:
- The required coverage only applies to polices covering insureds with fewer than 100 employees, i.e. small businesses of the type most seriously damaged by short-term shutdowns; and,
- An insurer who indemnifies an insured under these claims may apply for relief to the State Commissioner of Banking and Insurance for reimbursement of the claims.
The net result is that after the insurance company pays off the businesses making the claims, the State of New Jersey will reimburse the insurance companies. This helps spread out the cost over time and over more agencies, instead of hammering one company or one agency all at once.
WHAT DOES THIS MEAN FOR FLORIDA?
Nothing, yet. The New Jersey bill is still in committee. There are some concerns portions may conflict with the Contracts Clause of the U.S. Constitution. But if those issues can be corrected—and there is no reason to think they cannot be—then the bill could act as a springboard for other states to devise similar bills.
WHAT CAN WE DO?
Encourage your local politicians and legislators to start reviewing local statutes and see what can be done. If you know your state assembly and representatives, ask them for help.
As we all continue to closely monitor the outbreak of COVID-19 and follow the latest guidance from the CDC, please know that we are all in this together. The latest updates have resulted in many businesses being mandated to only offer pickup/delivery services, adjust their hours and unfortunately, closed.
Business owners, if you have suffered from loss of business or have been forced to shut down due to Coronavirus, your business interruption coverage might provide coverage for your loss of business.
At ILG, our experienced team of attorneys are ready to review your business interruption policy at no cost. We will let you know if it’s possible to file a claim and recover your losses. Contact us today.
