For Consumers

Pandemics and businesses

Pandemic threats, such as the coronavirus, may cause businesses to lose revenue or force them to close their doors for an extended period of time. Find out what you need to know about pandemics and commercial insurance to protect your business operations. 

What insurance do I need for my business to be covered for losses due to a pandemic?

To be covered against a business’ loss of revenue due to a pandemic, such as COVID-19, you would need to have purchased an insurance policy or an endorsement for your policy that covers such a loss before the outbreak started.

It’s unlikely you’ll be able to buy this coverage during the pandemic. After the pandemic is over and the market has stabilized, you can contact your insurance agent or company to see if they offer it.

If you need help understanding your policy, contact an insurance professional, like your insurance agent or your insurance company. If you do not have a copy of your policy, ask your agent or insurance company to send you the full policy, including all applicable endorsements and declarations.

NOTE: The Office of the Insurance Commissioner does not have the authority to mandate insurers sell or retroactively cover pandemic coverage or policy endorsements.

What if I already had a business policy that included business interruption or business income coverage? Will it cover my losses? 

Business interruption and business income coverage protects your business against losses you encounter when your business operations are suspended due to direct physical loss or damage. An example is if your covered property was damaged by a fire and your business must suspend operations until the covered property is repair or replaced. This type of policy reimburses the revenue you lost while your business was interrupted, but some policies may exclude coverage for pandemics or disease outbreaks.  

It’s important to read your policy for all exclusions, coverage limits and deductibles. If you have questions about whether your business interruption or business income policy specifically protects against business losses due to a pandemic, be sure to ask your insurance agent or company.

Commissioner Kreidler polled Washington state insurers to get a thorough picture of business interruption insurance. Read the findings. 

Will my business policy cover my business’ loss of revenue because of a government closure due to a pandemic?

There is a clause in most business policies called "Civil Authority," which addresses the situation when government prohibits access to your business. If your policy requires a “covered cause of loss” to be the reason why the civil authority restricted access to your business, your insurance company would need to determine if the pandemic outbreak is a covered cause of loss. Some business policies do not have this requirement. Please read your policy carefully. 

Commissioner Kreidler polled Washington state insurers to get a thorough picture of business interruption insurance. Read the findings. 

If I have sick employees due to a pandemic and have to temporarily close my business, will my business policy cover me?

Business policies can vary depending on what’s included in your coverage. We recommend you check with your insurance agent or company to see if your policy covers an employee availability due to epidemic or pandemic. Typically, business policies cover business closures for events such as fire, a burst pipe, or a windstorm.

Your insurer’s responsibility if you file a claim

If you file a claim with your insurance company, it must conduct a reasonable investigation. If it denies your claim, it must inform you of the specific language in the policy that denies coverage. If you need more information or have questions, contact your insurance agent or company.