» Question in regards to Presidio – Coronavirus Information
March 13, 2020
Dear Clients & Friends of Presidio:
We are closely monitoring the 2019 Novel Coronavirus (COVID-19) outbreak. Presidio is committed to helping you stay informed and educated about the insurance impact of COVID-19, while assisting those who might be affected.
Below you will find information with regards to Coronavirus and Property & Casualty coverages, Employee Benefits and Human Resources. Generally speaking, the information below should serve as an accurate assessment of today’s insurance industry standards and response to this pandemic. This is a fluid situation and any specific questions should be directed to your primary Presidio contact.
Property & Casualty: Every policy is unique and each carrier needs to determine the merits of an individual claim.
· Business Income (BI): Unfortunately, lost Income coverage would be triggered only as a result of a covered direct physical loss. As this pandemic would most likely not create a direct physical loss as defined by a policy, there would be no coverage. Coronavirus claims are unlikely to cause the property damage needed to create a business income. For example, a business may voluntarily shutdown for protection and to put people at ease, but that isn’t an insurable coverage. In the case of a government shutdown (Federal, State or Local) the same rules would apply.
· Workers Compensation (WC): Occupational Illness has historically been defined as an illness resulting from circumstances that are not prevalent outside specific industries/work settings (i.e. black lung in the coal industry, asbestosis in pipefitting, retinal burns in welding, etc.). In order for this current illness to be viewed as “work related”, it must be shown that the risk of contracting the illness is inherently higher as a result of your work/workplace/location than that faced by the general public. An example of this would be, business travel to a highly affected region of the world. As this current situation is still evolving, the coverage for Workers Comp claims will be determined on a case-by-case basis and will have to be decided by the courts in the future. Employees contracting COVID-19 may be covered by workers’ compensation insurance if they were initially exposed to the virus in the workplace or while working. That being said, an employee’s employment and the resulting exposure, must be the major contributing cause of contracting Coronavirus.
· Supply Chain/Dependent Property BI/Contingent BI: Dependent property coverage for the supply of parts/components for manufacturers may be interrupted by shutdowns across the globe. Again, these property policies depend on a covered direct physical loss to trigger coverage.
· General Liability: Commercial General Liability policies could respond to third-party claims when negligence can be proven as the reason for the exposure to COVID-19. Although there is a likelihood for limited insurance coverage, it’s worth noting that standard commercial insurance policies are not designed to cover the spread of contagious diseases like COVID-19 or the flu.
· Director’s & Officer’s Liability: Whether or not coverage will be triggered on D&O policies will be largely dependent on the individual circumstances surrounding an allegation. Case law will likely dictate if and how carriers respond and, currently, there is no precedent in many states for a claim of this nature.
Employee Benefits/Health Insurance:
With regard to treatment for COVID-19, group health plans cover medically necessary health benefits, including physician services, hospitalization and emergency services consistent with the terms of the member’s benefit plan. Members should always call the number on their ID card for answers to their specific benefit questions.
For diagnostic testing for COVID-19, please note the following coverage information:
Coverage for fully insured members: Effective immediately for all fully insured members, for testing to diagnose COVID-19 when medically necessary and consistent with Centers for Disease Control (CDC) guidance:
· No prior authorization needed
· No member copays or deductibles
What is the risk of COVID-19?
According to recent reports from the CDC, the immediate health risk from COVID-19 is low at this time for most of the population. However, older adults and individuals with chronic medical conditions like heart disease, diabetes and lung disease are at higher risk to get very sick.
More information: Because this is a rapidly evolving situation, continue to use the Centers for Disease Control and Prevention (CDC) guidance on COVID-19, as the CDC has the most up-to-date information and recommendations.
For Employers: The CDC has an entire section on its website focused on how coronavirus can impact employers.
Key sections of the site include:
· Recommended strategies for employers to use now
· What employers should do if an employee reports exposure to someone with COVID-19 (including the steps they should follow to conduct a risk assessment of their potential exposure)
· Recommendations for an infectious disease outbreak response plan
Presidio offers our commercial insurance clients two options when needing assistance with Human Resources.
· ThinkHR.com: ThinkHR.com is a complimentary resource available to you for a quick, straightforward question. Please take advantage of this valuable resource as needed.
· Presidio’s Human Resource Team: If your situation is more complicated, you feel you need clarification on the response from ThinkHR, or you prefer to speak with a live person, we do offer expert HR advice in-house. Please keep in mind that additional fees may apply with this service.
· See below HR Compliance Bulletin
As this situation continues to develop we will keep you apprised accordingly. While we are also focused on the health and well-being of our own employees, we will continue to be your resource.