Insurance companies are denying coronavirus claims to restaurants amidst losses

China is now on the road to recovery from the novel coronavirus while the rest of the world is just peaking with infections. The pandemic has resulted in lockdowns and many businesses have also been affected. The restaurant industry is one of the sectors which is going through rough waters, as the insurance companies are denying the restaurants for payouts that can help their business to survive. Many states across the globe have shut down the dine-in facilities and are only allowing home deliveries or take-aways in order to prevent the spread of the virus.

But there are also restaurants which have shut down completely considering the safety of their employees and customers. Other restaurants have learned to get adapted in the situation. Any restaurants had thought that the current situation would be covered with the business interruption insurance that covers a loss of income of a business after a disaster. It was only after the SARS outbreak, the regulators had also approved to some exceptions in the policies for the viruses and the outbreaks that are caused by the bacteria. An Atlanta based restaurant Castellucci Restaurant’s owner Fred Castellucci said that his insurer had denied the claim as the policy included an exception for virus outbreaks.

The owner added that such companies take money to cover their difficult times but when they actually need it, it is denied and they never pay out. When such an exception is not mentioned in the policy, the insurers can deny the claims with the help of an argument that the virus has not caused physical damage to the property. On the other hand the insurers are now being pressurized from the political point of view.

Even President Donald Trump has opined that the insurance companies should allow payouts for the businesses without specific pandemic exceptions which are related to coronavirus. But the American Property Casualty Insurance Association in a statement has said that pandemic outbreaks cannot be insured.

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