After insurance companies began denying COVID-19 business interruption claims filed by struggling business owners, the Louisiana Senate introduced SB 477. The bill, which was introduced on March 31, 2020, would mandate that insurance companies cover business interruption claims filed on behalf of business owners for losses stemming from the COVID-19 pandemic, a type of peril most insurers say is excluded in their policies.
The bill, which gave many business owners a glimmer of hope, read “Notwithstanding any other provision of law to the contrary, every policy of insurance in force in this state on March 11, 2020, and thereafter insuring against loss or damage to property that includes the loss of use, loss of occupancy, or business interruption shall be construed to include among the perils covered under that policy, coverage for business interruption due to [the] imminent threat posed by COVID-19.” Unfortunately, lawmakers like Sen. Rick Ward who were initially in favor of the bill, decided that it should be shelved “amid concerns it could crater the state’s insurance industry and embroil Louisiana in litigation” [Source: The Advocate].
Other Republican senators on the committee who also own businesses themselves agreed with Ward. While many have acknowledged that their business interruption policies won’t cover the impact of the coronavirus, “they resisted trying to force the coverage, saying the policies’ fine print indicated the exclusions, even if they didn’t notice them.” Committee Chairman Kirk Talbot, like many other business owners, was also surprised to find out that his business interruption insurance wasn’t going to cover claims stemming from the COVID-19 pandemic.
Still, Talbot “questioned how lawmakers could force the companies to pay for losses if businesses didn’t pay premiums to provide that level of coverage.”
Insurance Commissioner Jim Donelon Calls the Proposal “Dangerous”
Donelon not only called Ward’s initial proposal “dangerous,” but he also said that insurance companies cannot afford to pay out on COVID-19-related business interruption claims. The commissioner added that a payout of this magnitude would bankrupt the industry. As a result of the opposition Ward received, he decided to “strip the retroactive coverage requirement from his bill.”
Does this mean business owners in Louisiana won’t be able to obtain coverage for COVID-19 claims?
Not exactly. While SB 477 would have certainly put business owners a step ahead, it wasn’t a guarantee that they would have obtained coverage as insurance companies would have likely filed an appeal against the bill. Therefore, if your business interruption claim was denied, your best bet is to contact a Louisiana insurance claims denial lawyer who can help you get your claim approved. To speak with an insurance claims denial attorney in Louisiana now, contact USAttorneys.com.