Since mid-March, the state of Massachusetts and surrounding states have been on quarantine lockdown. This means that businesses have been shuttered or have shifted to working remotely unless they are classified as essential. It also means that millions of employees have been furloughed or laid off due to this global health crisis. As of last count, 30 million people have lost their jobs and filed for unemployment benefits.
What does all of this mean for business owners? Will they file for bankruptcy, take loans to stay afloat, rely on government stimulus programs to help until things get back to “normal?” The answer will be different for each business depending upon the number of employees, the nature of their work, and demand for their type of business going forward.
A few things will be the same for all business owners as we navigate the reopening process across the region – the need for business liability insurance or commercial liability coverage. One major question that owners will need to consider will be “what kind of business liability insurance will be needed to protect against employee illness, rehiring litigation, and potential discrimination that could occur when owners are faced with decisions on who to rehire and who will remain unemployed?
Workers’ Compensation Issues
According to SRHM, an online site dedicated to Human Resource news, trends, and analysis, states that there are special circumstances at play when dealing with workers comp for employees out sick with complications due to the coronavirus. “Normally, when it comes to workplace illnesses, most state statutes only pay out benefits if the disease in question is occupational in nature.” This is to say that communicable and contagious diseases are generally excluded from workers’ compensation policies.
However, coverage may be triggered if the illness arose due to or in the course of the worker’s employment. In general, these scenarios are examined on a case-by-case basis, but could include instances when: a health care worker contracts COVID-19 at the hospital where he or she works, an airline employee contracts COVID-19 from a passenger, or a hospitality worker contracts COVID-19, which is later linked to a large event at which the person worked.
We advise that you check with your business insurance agent to find out where you stand on coverage prior to opening so that you will be covered should your employees contract the virus.
In addition to workers’ comp concerns, business leaders will want to investigate liability issues that may be connected to the coronavirus outbreak within your office or building. COVID-19 raises a number of liability concerns, particularly if guests, customers, clients, or employees allege they became sick due to a business’s negligence. For example, unsanitary practices, lack of protective equipment, and not following guidelines set forth by the state and local municipalities regarding workplace conditions.
When it comes to these concerns, it’s important to confirm your liability insurance with your agent/carrier. General liability insurance, sometimes referred to as commercial liability insurance, protects your business from financial loss should you be liable for property damage or personal and advertising injury caused by your services, business operations or employees. In regard to COVID-19 specifically, general liability policies should provide coverage and allow you to defend claims.
There may also be questions of discrimination when it comes time for business owners to choose who to bring back to work and who will remain on unemployment until business revenues rebound.
Where do you stand in regard to your liability coverage in the age of COVID-19? Check with our agents to find out what coverage you have and what vulnerabilities there may be as we begin reopening in our area.