Business interruption claims can be challenging from all sides of the equation.
The insured is responsible for the formulation of their claim. In order to do this, the insured must make sure that the policy responds to the event (the policy may not cover the pandemic, but if the business cannot get supplies from a major supplier, the policy may still respond), and will have to calculate the losses sustained during the period. The insured at all times must act as if he is uninsured, and so it will be critical when formulating the claim, to have a mitigation strategy in place to reduce the losses when the company starts production again – This mitigation strategy may include extra staff, equipment and overtime payments to produce more when the company starts again
Dentists would be a good example of companies that need a mitigation strategy, as they will have to see a large number of patients who have missed their checkups and cleanings. This will no doubt result in substantial overtime, but will also reduce the claim that the dentist can make for the loss of income.
The insurer through their loss adjusters will have to make sure that the policy responds to the claim, that there is an adequate mitigation strategy in place by the insured to minimize losses, and a payment plan to pay out the insured based on the losses and proposed mitigation plan.
Working with experienced professionals to formulate the client’s claims will assist tremendously in preventing client dissatisfaction in the claims process due to unrealistic expectations. The experienced professional can also speed up the process, by providing an independent claim based on the facts.