Due to the safety concerns from COVID-19, many businesses have closed because they have been ordered to. Whether by city bylaw, or provincial mandate, establishments have been shut down. If forced to close, can businesses recover any lost revenue, or be reimbursed for any normal operating expenses?
Businesses may have purchased insurance which covers them for these closures. This is known as Civil Authority Coverage, where due to safety concerns for the general public, a government body is denying access to a business premises.
Much like other forms of Business Interruption Insurance, this coverage is not standard on every commercial policy. Even if purchased, all policies are different, and coverage for losses will depend on the specific wording and definition of each term.
The key questions to answer are:
If your business has been forced to close because of government order, you should first review your insurance policy to see if you have coverage. If you have questions about your commercial policy or have been denied by your insurer, we encourage you to contact one of our lawyers to discuss your specific situation.
Written by: Douglas Chiu