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The coronavirus and business insurance

Mar 17, 2020
4 min reading time

There are currently many calls from businesses asking if business insurance policies provide any kind of coverage for loss of revenue due to (the measures taken to combat) the Coronavirus.

First of all, we hope that you and those around you will remain healthy and that your activities can be restarted soon or returned to their former level.

Business damage or transportation insurance coverage applies to property damage. This is not the case with the coronavirus, and thus this damage is not covered by these insurances. There are insurances where you may have (limited) coverage for the financial consequences of the coronavirus, but this depends on the situation and the policy terms.

Business travel cancellation insurance

Cancellation insurance provides coverage for the events described in the policy terms and conditions. Infectious diseases are generally not covered. For example, if you booked a business trip last year, but this destination is now designated as a red-risk area, always check your policy conditions to see if there is coverage on your travel or cancellation insurance.

Event Insurance

The Netherlands hosts many events every year that attract visitors from home and abroad. As a company, you can be involved in (part of) the organization of these events or organize something yourself. Does your event have to be cancelled due to the corona virus? Then talk to us to see if this is covered on your event insurance. Don't currently have event insurance? If so, you're probably too late to take it out. Insurers may include an exclusion for costs related to the coronavirus.

Goods Transport Insurance

Goods transport insurance focuses primarily on covering material damage to your goods during transport. The coronavirus does not cause material damage to these goods, but sometimes goods transport insurance provides coverage for inherent vice. You may have to deal with this, for example, if a transport with items that could spoil has already started, but cannot be continued and the goods spoil in port as a result. Think not only about containers left behind in China or Italy. In fact, as a result of the corona virus, containers may not be able to reach their destination port and therefore be unloaded elsewhere. If you are faced with the above situations, consult with your insurance advisor immediately about what steps you can take.

Verzuim insurance

In addition, as a business owner, you may also have to deal with sick employees. The principle of absenteeism insurance is to provide coverage if there is illness, but this insurance does not provide coverage for employees who, as a precaution, have been quarantined

Reduce premium

Several business interruption insurance policies have an annual premium based on expected turnover. In many cases, the terms and conditions of the insurance policy state that once a
year a time of settlement will take place. As a result of the Coronavirus preventive measures, there are a large number of companies that now have no income at all and whose annual turnover is almost certain to be lower than previously expected. The question is whether one can ask for an interim reduction in expected annual sales and thus in the nominal monthly premium. Although the policy conditions may indicate otherwise, Bureau DFO is of the opinion that if the entrepreneur can make it plausible that as a result of the current circumstances his annual turnover will be lower than previously expected to a relevant degree, an insurer is obliged to cooperate with this request.
This is also in line with government policy to provide maximum assistance to entrepreneurs to cope with the financial blows one will receive.

Are you entitled to defer payment of premiums?

Entrepreneurs who currently have no income may start having problems paying insurance premiums. The Insurers' Association has not
not (yet) communicated the policy by which insurance companies want to accommodate entrepreneurs on this point. We expect that a number of providers
will be willing to assess this type of request from a positive basic attitude. But right now there is no "right" to premium deferral.

Working time reduction

For staff in these types of special circumstances, it may be possible to apply for short-time work from the UWV. Through the UWV website, you can find more information and possibly apply.

Hopefully, you and those around you will be spared (more) misery and this difficult period can be concluded as soon as possible.

If you have any questions or comments as a result of the above, please contact us.

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