It’s been about a month since a Nashville bar joined several other business owners in a fight against their insurance companies. Nashville Underground, which has suffered serious financial losses as a result of the COVID-19 pandemic, filed a business interruption claim with their insurer only for it to be denied [Source: News 4 Nashville]. Knowing the business had to have some sort of coverage, the owner of Nashville Underground hired an attorney and filed suit against their insurer.

The insurance claims denial lawyer hired to represent Nashville Underground said that while his client’s policy “has a rider which specifically excludes coverage for viruses and bacteria, it does not address whether it’s a pandemic or not.” The attorney also says that despite the rider in the policy, “the exclusion does not apply to the losses due to food contamination under our policy.” Because so many business owners are being denied business interruption coverage for COVID-19-related losses, News 4 Nashville reached out to Kell Holland, who is the Executive Vice President of Zander Insurance to find out more about business interruption insurance.

Here’s what the news source learned.


What are the three areas insurance companies look at to determine if coverage is warranted under a business interruption insurance policy?


According to Holland, insurance companies are looking at the following three areas to determine if a business interruption claim should be approved:


  1. Insurers look to see if a company is entitled to business income. According to Holland, “for that loss to trigger there has to be direct physical damage to the building, so think about the tornados that came through Nashville.”


  1. The company also looks to see if the policy contains a virus or bacteria exclusion. Holland says that insurers are saying that “a virus is not a direct damage to the building and is not a covered cause of a loss. So, that’s usually the first area they’re saying it’s not going to be covered because of that.”


  1. The third area is civil authority. While insurers typically cover losses incurred as a result of a government shutdown, Holland says that the policy must include coverage for the loss and there “usually needs to be a direct or physical damage within a mile of your building.”


Now, because insurance policies can be confusing and interpreted differently depending on who is reading it, many business owners who have been told they do not have coverage believe their claim was wrongfully denied. It is for this reason that many business owners have turned to Tennessee insurance claims denial lawyers for help. In the event your business interruption insurance claim was denied, is available to help you locate an attorney in your area who will assist you in fighting for the coverage you are entitled to receive.

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