** This page was last updated 02/04/2020 **
These unprecedented times in which we find ourselves continue unabated with the further measures and restrictions that Prime Minister Boris Johnson announced in his televised address to the nation last week meaning that for many of us we are settling into a new of working from home. And still there may be steps which the Government may have to enforce to slow the spread of the Coronavirus (COVID-19) and reduce the burden on our amazing NHS
STAY HOME; PROTECT THE NHS; SAVE LIVES.
When all is said and done, our health and that of or loved ones is the most important thing but as a small business owner having to face difficult decisions and having to make those decisions at such a fast and ever changing pace, I understand the concerns and worries of our clients who will have shut up shop and wonder whether, if, and how they will come through this.
Whilst there is a lot of information available from news, social media and government websites, I wanted to provide my views in relation to any insurance coverage particularly Business Interruption covers.
As I have said in previous posts and when speaking with many of you directly, typically Business Interruption covers follow physical damage to your premises. A voluntary or, as is the case for the majority now, mandatory closure prescribed by the Government is not covered by most policies due to the lack of ‘damage’.
The Government has announced a raft of business support measures including the Coronavirus Business Interruption Loan Scheme (CBILS) to help business in this time of temporary closure and stoppage of normal business activity. For the latest updates and information please see:
CBILS is a loan scheme which we understand is accessed through one of 40 approved high street banks. Any fees for the arranging of the loan and the first 12 months interest is covered by the Government. Interest is however chargeable and will become payable after the initial 12 month period. Banks are being urged to be lenient in their lending criteria to ensure that all good businesses that face temporary financial difficulties as a result of the Coronavirus, will have immediate access to funding. Loans are available to all UK SME’s with a turnover under £45m and businesses can borrow up to £5m for up to 6 years.
Given the uncertainty and the ever-changing landscape of advice and support, I wanted to provide a few practical steps to prepare for making and substantiating any potential Business Interruption claim:
- Keep accurate financial records during this time in case the Government introduce further guidance or future initiatives to recompense or support.
- Identify and record declining business activity as a result of the virus.
- Maintain accurate and up to date financial records and Management Accounts where appropriate.
- Identify additional costs and unusual costs incurred from steps you have taken to mitigate loss of business, and the effect they have had on revenue and profit margins.
In addition and in general, also ensure:
- You keep updated and abreast of the Government updates and announcements particularly in regards the health and safety of your employees.
- Keep your Insurer / Insurance Broker updated on any change in business activities – such as a move to manufacture ventilators or hand gel instead of your normal products, or a move from restaurant/pub to take away services etc.
- If you have employees working from home it would be prudent for them to inform their home insurer of the fact. Most insurers we deal with have collectively agreed that home insurance policies and for that matter, private car insurance policies will not be invalidated due to a change in circumstances and use because of the Coronavirus. However, not all insurers have issued such a statement.
Finally I wish you all the very best in these trying circumstances. Make sure you are aware of all of the Government business packages available to help support your business through what are unprecedented times. None of us has had to navigate our business through anything like this and I hope and pray that we all come through this and continue to thrive in business on the other side.
Fiveways Insurance continue to service our clients, offering new quotations, servicing of existing policies and preparing and negotiating renewal of policies with our insurers. Please continue to contact us through our normal office numbers and email addresses shown below. All our staff are now working remotely from home but all have connectivity and capability to continue providing the excellent service you have come to expect and enjoy from us.
Keep safe, and keep well.