Massachusetts Introduces Bill that Would Mandate Insurers to Cover Business Interruption Claims Related to COVID-19 Losses

The COVID-19 pandemic is wreaking havoc on businesses located all across the U.S., including those in Massachusetts. It’s been weeks since the government ordered non-essential businesses to close and many are now growing concerned that they won’t be able to climb their way out of the financial hole the pandemic has pushed them into. It seems the only way out is if these businesses are provided with some sort of relief.

But where do they get it from?

While the government did pass several stimulus packages that aim to help small businesses, many either don’t qualify for the loans or they are unable to apply for the type of loan they do qualify for as the funds have already run out. In fact, as of April 28, 2020, the U.S. Small Business Administration’s (SBA) website stated that the agency is unable to accept new applications for the Economic Injury Disaster Loan (EIDL), one of the few types of loans that are being offered. To make matters even worse for business owners, insurers are denying their business interruption claims for COVID-19 losses alleging they don’t cover pandemics.

But business owners in Massachusetts may soon be seeing the silver lining to their denied business interruption claims.


Massachusetts Lawmakers Introduce Bill SD.2888 Accompanied by Bill S.2655


After insurance companies made it clear that they would not be covering COVID-19 claims filed by business owners seeking relief, lawmakers introduced Bill SD.2888. The Bill states the following:


Notwithstanding the provisions of any other law, rule or regulation to the contrary, every policy of insurance insuring against loss or damage to property, notwithstanding the terms of such policy (including any endorsement thereto or exclusions to coverage included therewith) which includes, as of the effective date of this act, the loss of use and occupancy and business interruption in force in the commonwealth, shall be construed to include among the covered perils under such policy coverage for business interruption directly or indirectly resulting from the global pandemic known as COVID-19, including all mutated forms of the COVID-19 virus.”

The Bill goes on to explain that “no insurer in the commonwealth may deny a claim for the loss of use and occupancy and business interruption on account of (i) COVID-19 being a virus (even if the relevant insurance policy excludes losses resulting from viruses); or (ii) there being no physical damage to the property of the insured or to any other relevant property.”

Now, because Bill SD.2888 has not yet been passed and insurers are likely to file appeals against it, you are going to want to retain an experienced Massachusetts insurance claim denial lawyer if your business interruption claim was denied. USAttorneys.com works closely with some of the best insurance attorneys in Massachusetts and can connect you with one now.

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