How does insurance respond to COVID-19 events?

| April 06, 2020

As small business owners, we understand how vulnerable everyone must feel in this ever-changing situation. We are trying to operate our businesses under extraordinary circumstances. The emotional and financial toll is enormous. If you have any questions that you would like to discuss personally with John or me, please feel free to call our office at 609-399-0655. If you leave a message, know that we will return your call as soon as possible. We appreciate your business and want you to trust that we are here for you.

Tom Heist & John Heist

In this challenging and unpredictable time, we are doing our best to keep you informed on any insurance or business-related issues regarding the COVID-19 impact. We have prepared this communication to answer simple questions regarding insurance coverage for injury or damage as a result of the COVID-19 outbreak. Please understand that an actual claim will have specific facts that can materially change the coverage as described below and your insurance policy is the ultimate contract to accept or deny coverage. As the COVID-19 spread is an evolving situation, the regulations and laws governing how coverage applies may change over time and we will continue to share this information as it becomes available.

Group and Personal Health Insurance

All health carriers have been directed to waive the cost of a COVID-19 test. As of now, if hospitalization or at-home treatment follows, you will be required to pay normal deductibles and co-pays. We have found that most carriers are waiving the copay associated with Teladoc services. The CDC is recommending that you contact Teladoc if you feel you need a test in lieu of going directly to a hospital.

Sickness of an Employee

Some of our insurance carriers have communicated that if two or more employees are diagnosed with COVID-19, it would be covered as a Workers Compensation claim. If only one employee is diagnosed it is difficult to presume that the exposure happened at work so this claim should be directed to that employee’s Health Insurance company.

Economic Loss or Business Interruption

As of now, there is no coverage available for economic loss or loss of business income as a result of a virus. All Business Interruption policies currently trigger coverage when there is “physical damage to an insured structure by a covered cause of loss”.

Loss of Use / Rental Income

As of now, there is no coverage available for economic loss or loss of rental income as a result of a virus. Loss of Use coverage currently triggers when there is “physical damage to an insured structure by a covered cause of loss”.

Business or Personal Liability

Most general liability policies contain a virus exclusion that would deny coverage if you or your business is sued for any virus-related lawsuit.

Food / Product Delivery

Businesses have started offering delivery services due to COVID19 and may not be aware of a potential coverage gap. Please contact us to obtain Hired/Non-owned automobile coverage which provides liability protection for your business in the event of negligence by an employee if he/she is driving their own personal vehicle while performing job-related duties.

Professional Liability / Malpractice

Businesses that provide medical services would be covered by their Medical Malpractice insurance for a claim associated with COVID-19.

Avoiding a Lapse in Coverage for Non-payment of Premium

Unintended insurance cancellations can have a negative effect on the pricing and availability of future insurance. Please call us to see if payment options are available before letting your policy lapse for non-payment of premium.  


Please review the additional resources below for possible financial assistance:

The Small Business Administration is working to offer low interest federal disaster loans for working capital to small businesses suffering substantial economic injury as a result of COVID19. Click here for more information

The local Small Business Development Center is available to assist you. Contact Carol Waties at 609-626-3889 or email


For general, reliable information, please visit these websites:

For business concerns during this emergency, the NJ Business Action Center has established a website devoted to this situation:


The NJ Business Action Center helpline is now available 7 days a week, from 8am to 9pm, at 1-800-JERSEY-7