Businesses urged to check insurance policies for Covid-19 payout
NSW businesses that were hit hard by the pandemic have been urged to check their insurance policies as they may be eligible to claim a payout from their insurer.
According to law firm Slater and Gordon senior associate James Hunter, businesses that had customer-facing services could potentially be eligible for a business interruption insurance payout.
“Restaurants, bars, gyms, dance studios and businesses offering public facing services who lost money as a result of Covid-19 may be able to go ahead with a business interruption insurance claim,” Hunter said.
The call comes off the back of a recent court ruling that could see some businesses newly eligible for a payout.
What’s happened?
A NSW Supreme Court of Appeal decision from October found that four businesses, which had been denied a claim from their insurer, should have in fact been paid.
The insurers had attempted to deny the businesses’ claims on the basis of a policy clause that excluded damage from viruses declared quarantinable under the Quarantine Act.
However, this 108-year-old Act was repealed in 2015, and replaced by the Biosecurity Act.
Consumer-facing businesses should seek legal advice to find out if they’re eligible, Hunter said, including businesses that have been knocked by their insurers over the outdated Act.
“Businesses that can now potentially make claims include some that were previously denied claims for losses based on the NSW ruling,” he said.
“We strongly urge people to check their insurance policy and to seek advice if they think they may be eligible or even if they’re being told by their insurer that they’re not.
“Even though the current ruling will likely be appealed and continue to play out in the court system – potentially for years – businesses are currently able to challenge exclusions individually.”
Yahoo Finance has reached out to Slater and Gordon for further comment.
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