Coronavirus (COVID-19)—insurance considerations

The following Insurance & Reinsurance practice note provides comprehensive and up to date legal information covering:

  • Coronavirus (COVID-19)—insurance considerations
  • Impact of coronavirus on the insurance industry
  • Property and business interruption insurance
  • Property insurance and loss of rent
  • Business interruption insurance
  • Event cancellation insurance
  • Travel and aviation insurance
  • Aviation insurance
  • Liability insurance
  • Employer’s liability insurance
  • More...

Coronavirus (COVID-19)—insurance considerations

The coronavirus (COVID-19) pandemic has profound implications across the global economy and poses an existential threat to many businesses. This Practice Note considers the impact of the pandemic on the insurance industry, identifies the types of insurance policies that businesses may look to for cover for coronavirus-related losses, summarises the typical coverage position and looks at other issues that may arise.

Impact of coronavirus on the insurance industry

The insurance industry faces higher claims exposure and increased operating expenses as a result of the coronavirus outbreak. Combined with low interest rates on investment returns due to the economic consequences of the outbreak, the operational resilience of the insurance industry has been truly tested.

Regulators understand the severity of the crisis and have emphasised the critical importance of operational resilience. The Financial Conduct Authority (FCA) has stressed the importance of treating customers fairly, having regard to the extraordinary challenges that many policyholders are having to deal with during the coronavirus outbreak.

Coverage issues across most classes of business have arisen, including causation, due to challenges such as identifying when, how and why people contracted coronavirus in different contexts.

The requirement in some policies that cover for economic losses must be triggered by physical damage has also been the subject of many property and business interruption insurance disputes.

Complexities such as divergent dates upon which different governments recognised coronavirus as

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