A frequent question that we have had from many or our business clients is will I be covered by my business interruption coverage if I need to shut down as the result of COVID-19. For the most part the answer is no. Most Canadian Insurers use standard Insurance Bureau of Canada (IBC) wordings in which there is no coverage for business interruption due to an outbreak or disease. Business interruption coverage is only triggered by an insured peril contained in the policy. This means that there must be property damage to the building and/or contents. Business interruption cannot be triggered on as the result of a slowdown in business, closure or quarantine as none of these events are an insured peril.
It’s important to note that there may be a number of exceptions and we encourage everyone to check with their own insurance provider.