Business owners in Arizona have grown increasingly frustrated over the last few months as many are finding out that their insurance companies don’t want to cover their business interruption claims stemming from COVID-19 losses. Some have even filed lawsuits against their insurers because of it. Despite the backlash and lawsuits insurers are getting hit with, most are standing firm on their decision to deny claims.

But why?

According to insurers like Chubb, business interruption coverage “generally only covers losses to business income caused by property damage.” Chubb’s website explains that “the vast majority of business interruption policies require direct physical loss or damage to property, such as a fire or flood that damages the property and prevents the business from operating while repairs are being made.” The company says that “each policy describes the events that trigger business interruption coverage.” Many insurers are also alleging that most, if not all, of their business disruption policies specifically exclude viruses, bacteria, and pandemics.


What about civil authority coverage?


Chubb’s website explains that civil authority coverage is also triggered by physical damage to the insured’s property or an adjacent property. Hence, the losses suffered as a result of the government-ordered shutdowns due to COVID-19 are not insurable. Chubb says that the government shutdowns were meant to keep people socially distant from one another, not because your property is considered to be dangerous.


Can a virus cause physical damage to a property?


This is one question many business owners are asking themselves and a question many judges who are assigned to oversee the cases being brought against insurance companies nationwide will have to decide on. The fact is, while insurance companies allege the COVID-19 virus does not cause physical damage to a property, there are many business owners who believe it does which is why they are taking their denied claims to the courts.


Are any insurers paying business interruption claims associated with COVID-19 losses?


It is still unclear, however, Chubb has said that it is paying claims for “business interruption where direct physical loss or damage to property is not required, such as event cancellation.”


What should I do if my insurer denied by business interruption claim?


Contact so that you can be connected with an Arizona insurance claims denial attorney in your city.

The fact is, if you want to challenge your insurer’s decision and potentially come out on top, you are going to need to hire an Arizona insurance claim denial lawyer to help you. Because insurance companies are backed by large firms that know how to build a defense against your claims, you are going to want someone with equal experience defending your rights as a policyholder.

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