COVID-19 and Business Interruption Claims in Las Vegas
The COVID-19 pandemic has impacted businesses worldwide. It’s been particularly hard on smaller businesses. Many in Nevada have had to close permanently because they lack the safety nets that big corporations enjoy.
The American Property Casualty Insurance Association estimates that companies with fewer than 100 employees are losing between $255 billion to $431 billion per month due to the coronavirus and related restrictions. With small businesses losing that much money, it’s no wonder many of them are using any tools they have at their disposal to stay afloat, including filing business interruption insurance claims.
Business interruption insurance provides coverage for lost revenue and pay to companies who are damaged due to circumstances beyond their control. Exactly what is covered varies widely. Weather-related damage, theft, and fires are examples of what a business interruption insurance policy might cover.
However, many insurance carriers are not paying business interruption claims for COVID-19. They have argued that the language in a standard property or business policy doesn’t cover losses due to the pandemic. If you’re a business owner and your insurer has denied your business interruption claim, it’s time to seek legal counsel.
The experienced business interruption attorneys at THE702FIRM Injury Attorneys in Las Vegas are ready to enforce your rights. Call or contact us right away for a free consultation to discuss your legal options.
What Is Business Interruption Insurance?
Business interruption insurance is supposed to help business owners in times of trouble. They pay premiums to manage risk and protect their livelihoods when unexpected problems arise.
Getting business interruption coverage will depend on the wording of your policy, including its many disclaimers and exclusions. At THE702FIRM Injury Attorneys, we are skilled at analyzing these policies carefully to ensure that insurers are meeting their obligations to business owners.
It’s smart to speak with a knowledgeable business interruption attorney before filing a claim with the insurance company. You’ll have to speak with an adjuster, who will ask specific questions about your losses and the steps you have taken to mitigate them. These questions are designed to justify reasons for dismissing your claim. A lawyer can talk to the insurance company for you so that you are treated fairly.
If you have already filed a business interruption claim and have been denied, you can dispute it. Having a lawyer by your side at this point is essential because you’ll be going up against a system that’s already stacked against you.
COVID-19 and Business Interruption Claims
Typically, business interruption claims fall under what’s known as “time element” coverage in a policy. The idea is to compensate the policyholder for damages sustained during the time when the business was unable to operate normally. A global pandemic is certainly something most businesses cannot prepare for, and the impact has been felt in numerous industries that normally thrive in Las Vegas, such as:
- Retail establishments
- Small businesses
Many insurance carriers have argued that business interruption insurance is designed to cover lost revenue for actual property damage, not losses stemming from a preventative coronavirus shutdown when the virus was not detected on the property. Insurers have been more willing to pay claims in cases when a business was temporarily shut down after a case of COVID-19 was confirmed.
Some policies also cover what’s called civil authority. That means if your business has to shut down due to a governmental order, you could be able to recover lost income. That could be positive news for businesses shuttered due to COVID-19. But again, we are in uncharted waters. Call a Las Vegas business interruption lawyer at THE702FIRM Injury Attorneys to see whether you have civil authority coverage under your policy.
How Is Business Interruption Insurance Calculated?
Typically, a business interruption claim is calculated using the following formula:
- Net income + continuing expenses + extra/additional expenses = business interruption loss
Business interruption claims require supporting documentation to back up the case. This information typically includes things like expense and revenue reports, payroll reports, tax documents, and so on. An accomplished Las Vegas lawyer can collect the relevant information for you to build the strongest possible claim for you.
What Can You Recover from a Business Interruption Insurance Claim?
Business interruption insurance is there to cover a business owner’s physical losses. This means that you cannot collect damages for things like emotional or mental anguish. Physical losses typically include:
- Lost profits: If your business is closed, you’re not making any money. Business interruption insurance reimburses the insured for whatever profits (not revenue) they would have made had the event or disaster not occurred. Profit figures are usually based on the business’s figures from the month before the event or disaster.
- Employee wages: Depending on the particulars of the individual policy, a business interruption claim may cover wages for employees if doing so is deemed essential to avoid losing those employees while the business is shut down.
- Taxes: Businesses often have to keep paying taxes even if they’re not actively operating. By covering those payments for the insured, business interruption insurance makes sure the business isn’t hurt by penalties because of a missed or delayed tax payment.
- Fixed costs: Every business has fixed costs, from office supplies and rent to operating expenses and utilities. These costs also include any loans the business has taken out and may be making payments on. If the business isn’t operating, they can’t make the payments, which is what insurance is for.
- Repairs and relocation: If a business needs property repairs done before it can reopen or needs to relocate for a while, its insurance policy may cover those expenses.
- Additional expenses: This category includes anything else (within reason) you may need to reopen after temporarily closing your business, such as new marketing materials, fresh supplies, etc.
How to File a Business Interruption Claim in Las Vegas
If your business was forced to close due to a COVID-19 shutdown, contact a business interruption lawyer right away. You may very well have a valid claim, but don’t count on your insurer to make it easy for you to recover money.
Acting quickly is important. Your policy may have a time window to file a claim. You don’t want to be denied because you took too long to file your claim. If your business sustained any additional damage due to vandalism or something similar, make sure to contact the police or other authorities as well.
Many insurers have language in their policies that excludes claims related to pandemics, but you should file a claim anyway. The law surrounding these claims is still in flux, and filing a claim at least gives you a chance at recovering some kind of compensation.
What If My Claim Is Denied or Lowballed?
If your claim is denied, or if you feel like you are not getting an adequate amount of compensation, you should seek out an attorney as soon as possible. With so many insurers issuing blanket denials for claims related to COVID-19, legal action may be your only chance to recover any kind of compensation for your loss.
How THE702FIRM Injury Attorneys Can Help You With Your Claim
Hiring a capable, experienced lawyer is essential for any business interruption claim. When you hire THE702FIRM Injury Attorneys, you’ll have experience, a proven track record, and dedication on your side.
Right now, you have enough to worry about to get your business back on its feet. We’ll keep the pressure on your insurer while you focus on the day-to-day needs of your company. These cases can be stressful, complicated, and emotionally fraught, but we’ll handle the legwork for you.
Remember, the laws surrounding COVID-19 claims are changing constantly. Our lawyers are keeping up with all the latest updates. We’ll make sure to keep you in the loop as your case progresses.
THE702FIRM Injury Attorneys has recovered millions of dollars for our clients, and we’re committed to helping you recover every cent you’re entitled to.
Another perk is that our law firm takes cases on a contingency fee basis. That means that we don’t collect a dime unless we obtain compensation for you. We’re not here to kick you while you’re down. We’re here to lift you up.
To learn more about how we can help, call to schedule a free consultation or fill out our quick online contact form.