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COVID-19 – Considerations for Business Insurance Policyholders
COVID-19 has created a new risk environment for business clients. In this article, we highlight a number of pertinent issues that relate to particular areas of policy cover.
To ensure you are protected, please read the information below. Should you become aware of any potential risk exposure to your business please don’t hesitate to contact our staff at your nearest local office.
CONTRACT WORKS INSURANCE – POLICY LIMITATIONS
The construction industry, like so many others, has been severely affected by the Covid-19 virus with many sites now closed until further notice. Two main issues must be addressed with regard to insurance relating to Contract Works.
- Firstly, there is a Cessation of Work Clause applicable to this type of policy. This restricts cover to a specified period following cessation of work. There is no standard time limit and each policy wording should be reviewed individually.
- Secondly, the Contract Works Policy extends to include cover for completed properties. Once again, there are varying time limits applicable across the market. As sales of completed properties may have been held up, due to current circumstances, time limits need to be reviewed as they might be coming to an end.
In any case, we can help so please get in touch with your local office to discuss your particular policy in more detail.
DIVERSIFICATION OF BUSINESS OPERATIONS
In the wake of the coronavirus outbreak, many business clients have started to feel the strain. Some have found ways to adapt or alter the services they provide whilst this period of isolation and social distancing continues. For example, a brewery adapting and utilising their fleet for delivery services.
If you have been forced to adjust your business’s model, it is important that insurers are notified in order that you and your employees remain appropriately protected.
MOTOR TRADE RISKS – UNACCOMPANIED DRIVERS
As motor traders and car dealerships plan a gradual return following the lockdown, it is anticipated they will be required to operate the 2-metre social distancing between customers and staff.
Whilst these restrictions can be implemented in showrooms and workshops, they can’t be applied on test drives. Therefore, it is important that your insurance policy has an Unaccompanied Demonstration Extension as insurers may not pay any claims without this.
Where you occupy premises and/or have a storage site, it is likely that your cover is subject to compliance with the Unoccupancy Condition in your policy. This policy condition requires you to advise your insurer of any premises that has become unoccupied.
Most insurers define unoccupied premises as one that has not been occupied or used for 30 days, even if it has become only partly unoccupied. If a premise becomes unoccupied you may be required to take certain action regarding the management of the risks associated with this. Additionally, some of your policy covers may be reduced in these circumstances.
Rather than imposing their usual requirements, many insurers are sympathetic in their approach where the unoccupancy is Covid-19 related. So, if your premises are now unoccupied, we would urge you to discuss your specific circumstances with a knowledgeable insurance provider so that the best solution can be identified. Our regional office’s contact details can be accessed here.
TYSERS RISK SERVICES
Our Risk Services solution provides a portal where our clients can access support and details on how to develop, implement, and maintain required policies, procedures and processes. We are continuously updating our advice with the latest regulatory information. This service provides a range of templates and policies, such as a COVID-19 Risk Assessment. All policyholders are able to access this complimentary service where experts in risk management can advise you on how best to protect your business, staff, and clients.
LEARN MORE ABOUT TYSERS
During the COVID-19 pandemic, the operating environment for UK businesses constantly evolves, and navigating the emerging risks can prove challenging. At Tysers our consultants work closely with clients and insurers to:
- Prevent unnecessary premium increases at renewal
- Try to stop new coronavirus exclusions from being added to your policies that may prevent you from making a future claim
- Help you decide whether any of your pandemic related losses are covered
- Advise you on whether notifications need to be made on any of your insurances whilst you have cover (and before it is removed at renewal) in relation to you being sued by staff, suppliers, shareholders, banks or customers
- Check if you are in breach of operational conditions in your policies as a result of business change.
If you need help or advice please give us a call. To learn more about our insurance and risk management solutions for business clients.