Why insurers won't cover businesses' coronavirus losses
Portland chef Carlo Lamagna sat in his empty restaurant and called his insurance broker. He wanted to file a claim, even though he'd been warned it would likely be denied.
It had been just seven months since Lamagna opened his Filipino restaurant, Magna Kusina, dedicating it to his late father. But then, Oregon Gov. Kate Brown closed the state's restaurants as she tried to keep the coronavirus pandemic from spreading too quickly and overwhelming hospitals.
"We're completely closed. I mean, we have to do what we can to flatten that curve, try to get it down."
"The filing of the claim, it's just … it's not gonna get us anywhere?" Lamagna asked his broker. "At all? Zero?"
When an insured business loses income because of fire or storm damage, it may file a claim for lost revenue. That protection — known as "business interruption" coverage — is often included within an insurance policy's property coverage.
But as the coronavirus shutters small businesses across the Northwest, business owners are bracing for a wave of insurance denials. That's because insurers have been telling businesses that coronavirus losses don't count.
On the phone, Lamagna answered a few questions from his broker. No, he wasn't doing take-out or delivery, even though the governor left that option open.
"We're completely closed. I mean, we have to do what we can to flatten that curve, try to get it down," he said.
This OPB story is shared as part of a local media project to increase COVID-19 news coverage.
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