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What Every Business Owner Needs to Know About Filing Business Interruption Claims

As part of our own Jonathan Garber’s webcast series, he continues to interview leaders in the community who share tips and strategies to help us all Thrive during the Coronavirus shutdown. Today, Jonathan is joined Leonard Desir of the Desir Law Firm. He shares his experience on helping business owners navigate the complexities of filing a Business Interruption Insurance claim.

If you’re a leader willing to share your knowledge with our audience on how they can thrive during this crisis, please email Jonathan at [email protected]

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Transcript

Well, good morning everyone. It’s Jonathan Garber from flying chimp media. I’m back for one of my daily webcasts during our coronavirus or covid-19 shut down how you can Thrive through this crisis and come out well on the other end joining me today is another leader here in South Florida where I’m based, please welcome Leonard Desir from the Desir Law Firm. Good morning, Lenny. Good morning. So, I’ve asked Lenny to join us for one of these webcasts talk to us about insurance business insurance in particular what some things may be hidden in your policy that could have a payoff for business owners now Leonard, I mean you obviously you follow the news you’re living the news like the rest of us. Tell us exactly. What kind of law you practice? Well, I drink coffee. Sure I practice first party property insurance law which involves helping policy holders that have disputes with their insurance company for property damage, you know that they make for instance if they could be a hurricane could be water damage could be a theft vandalism or even in this particular case, let’s say the coronavirus for business for business we’re people may traditionally think of first party property claim attorney say that three times fast an insurance attorney like yourself. Well you may think of that primarily around homeowners’ claims. You have a whole side of the business focused around business claims. Yes. Okay, so, you know business insurance policies. Yes. Okay so now we were talking in the pre-show when we were in the green room. We were talking about some hidden things in a policy that are either directly business Interruption insurance or what I call business Interruption Insurance adjacent in the property sector in the commercial property that business owners may be able to make a claim. Can you share that with people? Sure. So for business owners their needs any to look under their commercial property policy for it to see first of all, if they have business interruption or business income loss coverage under the policy and you know that may be able to protect them from situations where they have you no damage from a fire damage from some sort of vandalism or damage from potentially even in this situation that we’re dealing with now, corona damage, but business Interruption from not being able to operate their business during this time where we have the social distancing the corner virus. Okay, so they could make a claim under traditional business interruption or possibly under commercial property. Is there restrictions on what they can do with that money. Can they continue to pay employees? He’s rent. How does that work? So, the business Interruption what it will cover. So, the business Interruption is found under the commercial property or shh their policy. So, it will potentially cover for things like payroll that you’re not being able to potentially cover at that point in time. It may cover for additional ago. There’s something well there’s actually business income. And there’s something also called extra expense. So there’s two different portions of it under your under your commercial property policy and depending on whether your particular situation fits under the definitions of under the policy, which I haven’t memorized but you know, depending on what’s on your policy, then you may be covered. Okay. So, what so two things let’s talk about action items for business owners. They might have some time on their hands now. It sounds like they should be calling their commercial insurance agent and asking about that coverage. And if you want to file a claim should they review the policy and a claim with an attorney first or just jump in? What’s what do they do? What’s the action step for a business owner says, you know what I’ve been paying premiums for years. Right, most people homeowners and businesses. They pay premiums for years well they like some of that back, right? Who do they where do they go with that? Sure. I mean, they can definitely call their commercial insurance agent their insurance agent may have told them, you know their business policy and other things as well to just make sure that they get a copy a full copy of their policy. And then from there, I would advise that they consult with an attorney like myself just to make sure they can you know review the policy make sure that their particular situation that they’re potentially trying to claim is covered under their policy. So those are the first steps that can be taken. Okay. Are you our people in your space? Business litigation attorneys first party property claims attorneys. Are you and your peers reviewing policies for people? I don’t want to call it pro bono. That sounds like a criminal thing. But are you guys just reaching out and letting people where you know review policies with people? Yeah. I mean, we’re being a policy, you know, I personally don’t charge for that. You know what other attorneys do and I can’t speak for them. But you know at the end of day You know if there is potential coverage for making a business Interruption claim, you know, I’ll definitely advise someone that that is a possibility and if they want to pursue it, you know, they can but you know, I think the day to review it for me, you know, you know, I wouldn’t charge for that. Okay. So, in the in the age of a covid-19 shutdown I assume you’re able to do all these consultations over a medium like this. We’re on Zoom. They could use anything, right? Okay. do it over Zoom. They can email me adjust the policy or and then after the fact we could talk about it by Zoom phone by email by tanks. And yeah, it is a very, you know processed. Okay, great. That’s good to hear that. I love that. So many businesses have been able to make the leap service-oriented business is like, you know Professional Services have been able to make the leap to helping people remotely. I just think it’s vital that people get good advice. Remember if you deal with an insurance company, and I’m not going to beat up on insurance companies, right? I mean they’re there for you in some capacity when you need them, but they have an army of lawyers. right. I mean they have an army of attorneys and their primary goal is to pay out as little as possible. Yeah. Yeah, mean you definitely need to have an attorney on your side, you know, when it comes to these claims just to make sure that the you know your evening the playing field because I’m kind doing it trying to do it on your own or doing with a non-attorney helping you is not is not going to be in your favor a lot the time. Okay fair enough. I have another question and I don’t know that it’s where exactly Is with what about people I’m thinking of restaurants in particular which are hit very hard by this what happens to all their inventory? Okay freezers have in failed stuff, but not everything. This is fresh food. It doesn’t keep forever. Are they able to make a claim for lost inventory? They have to dump this food. Yeah, so I’ve actually worked did a claim for restaurant during Hurricane Irma and they had so they usually coverage for spoilage these funds commercial policies, which will also be under the commercial property portion. It’s different from the business Interruption. So, depending on what’s In Their policy, they may be covered for you know, things like that. Okay, so far for many commercial policies there something to cover loss. Payroll income and inventory if it’s a perishable inventory, that’s correct. So now there’s actually another thing I forgot to mention so there’s business income. There’s extra expense and then sometimes depending on the policy. It may even have extended business income. So business income or business Interruption May cover you the time that your business is down and then if you have something called a Ended business income depending on your policy in will cover you for lost income even after your business comes back or after you’ve gotten it, you know back to normal because even then you may still not be running at the full capacity brought in some kind of diminished income. Right? So, you may actually be covered for that too. And well again that all depends on your policy and what’s covered and definitely talk to your agent. If you have it, and if you don’t have it, I highly recommend getting it now question of exclusion, and obviously I’m not a lawyer and I’m not an insurance agent. There’s a question out there. I because I was speaking with somebody else yesterday about the words force majeure. I think of force majeure when there’s an act of God or an act of War, but this is a government mandated shutdown like Is that included excluded are you are we blaming this and saying well, how could an insurance company say? Well, that’s a virus. That’s a pandemic. That’s a force majeure or would they say no. No, my losses are from a government mandated shutdown, which is different that makes sense. Yes, old really lay person question. So, excuse me. Yes or no problem. Yeah based on my review, you know, a lot of these commercial policies are good forms and there is something in the policy. I would it’s not necessarily actually, it’s not an exclusion. This one is actually you could potentially get coverage for if your business is shut down by us. The way it’s worded in the policies is Authority now not based on what I read in the policy. I’m not necessarily sure the coronavirus would qualify based on the definition and again, I don’t know it off by heart, but from what I recall and what I read recently. I don’t think it would fit but you know, there is excluded. There’s an exclusion. I’ve seen it all other policies for virus or bacteria, which would fit under the Coronavirus. The situation and then if you had that particular exclusion definitely or to say unfortunately, you would not be covered. But if you don’t have that exclusion for virus or bacteria that causes, you know your business essentially to be interrupted or it for you to lose income. Then may be covered for business interruption or business income loss usually titled business income loss under the policy. So, it just again it Sounds I guess lawyer talk or cliché, but it depends on your policy. All right. So, policies are written policies are written for people like you they’re not written for people like me. That’s why there are good agents out there that can explain it to you in laypersons terms, but when it comes time to file a claim, I need some heavy weight in my corner as we say, I need someone like you and an Insurance agent, I need people, you know a team working together to figure it out you work with you’re not in competition with the insurance agent at that point. That’s kind of your partner and filing this claim. Am I correct, or right? I mean at the end of the day; I’m trying to help the policyholder. It’s nothing against the agent cells the policy and you know, that’s what they do. Yeah, and other thing I want to point out is, you know, the policies that legal document, you know drafted by attorneys. So even if the agent may understand the policy, they may not understand sometimes how that the policy has been interpreted in courts, and that’s important to know, you know to have an attorney who is familiar with how particular Provisions have been interpreted and sometimes the plain language may not be that clear or may not or may appear to be clear and it’s not clear, having an attorney that understands that is important. Okay fair enough. So, call your agent and if you’re thinking about filing a claim you might want to have an attorney review your policy and your claim and we’re not saying you need representation to file that claim. Right. If it’s not settled the way you want it that could be the time to bring an attorney to the to the gunfight, right? That’s correct. Okay fair enough fair enough. Well, Lenny, thank you so much for your time. I think you’ve passed a lot of information. I always think about like I don’t worry about large businesses. Not that they aren’t important to the community, but they have a lot of resources. They have a lot of depth and you’ve got a good legal team and sometimes it’s you know, staff counsel and you know, you start getting into those in-house counsel terms ago. Okay. I’m not worried about them, but there’s so many mom and pop businesses. 25 employees and under that are just the backbone of this community in South Florida. And if they don’t get advice like this, just free advice. They just don’t know and the money that they leave on the table could potentially spell the difference between staying in business and being out of business and its business. It’s a lot of income loss. From the community. It’s a lot of people who are relying on those businesses for their job and to feed their family. You know I mean? So, I want to thank you for taking the time early in the morning to sit for this interview. My pleasure. You’ve been asking me a lot of questions, but I’m curious to know how know Flying Chimp has been, you know, getting out there trying to help its client or others in terms of you know, what? Going on with this coronavirus. That is a great question. I appreciate that our business fortunately is not tied to an office. So, we have the Flying Chimp team has gone home and is working and I have a whole studio here in my home. So, I’ve been writing I’ve been posting press releases from working on a script for a video, you know, Jeff the creative director for the company has been putting up new website. So, a couple of things that we’ve been doing is we went to all of our clients most of whom are in professional services. That’s just kind of how it laid out and we asked them can we put a popup on your website that lets people know you can do a video consultation now that you can move online just like you said, hey, I can talk to somebody by phone. I could talk to someone by Skype video conference. If they don’t have a scanner, they could take a picture with their phone and send you a pic lean. Like come on like, you know, I always tell people if you don’t know how to do that go. I find a twelve-year-old. They’ll do it for you give it your all of your old a can of Monster Energy drink or Coca-Cola. They’ll show you how to do the technology. There’s no barrier there to doing business. And so, what we’re doing is helping our clients communicate to the market that they’re open for business. That people can get help now. That’s number one. That’s the first thing that we’re doing is going back and helping our clients show that they are in business. Secondly, we have not backed off of our search engine optimization or are marketing the monthly types of marketing activities. a matter of fact some clients have put their foot harder on the gas pedal and they’re saying When my competition says they’re not open for business. I want you to let people know we are so that’s been terrific. We’re just putting their foot on the pedal. We’re doing more marketing than ever. We’re taking a lot of messaging Facebook. For example, where there’s just a huge growth in traffic now. Everyone’s kind of connecting with people over Facebook. advertising. This is a great time to do that, even for businesses that don’t traditionally advertise. There’s just a lot of eyes on it. The biggest thing Leonard I would tell you that we’re doing is we’re positioning companies. To be ranked very high with an effective message the day the shutdown ends, which we don’t know when that is, but we know this can’t last forever either right? I mean, so if you said two weeks or three weeks or four weeks, I don’t know what our clients are saying in the people that are coming to us is hey, there’s going to be some contraction in my market. There’s going to be Less dollars, but there also may be less competition. You follow that Sykes some of their competition may also not be in business. So, what they’re going to do is fight for a larger slice of a smaller pie. So, the kind of clients that we’re dealing with are saying I want a bigger piece of a smaller pie and I want to position for it now. I want to tell the market I didn’t go out of business. I didn’t shut down. I just shut down my office and I’m still doing business that’s really important message of resiliency strength because you know after this and there is an after there is an after somewhere people are going to ask their vendors their people they did business with where were you like? We’re you there for me. When the chips were down were you there for me when we were out of I was I used to do a video about customer service and I used to say customer service is what you do when things go wrong not when things go, the measure of customer service is what you do as an individual and organization when the you-know-what hits the fan. When the hurricane hits when the power goes when the bridge goes out when you know, the coronavirus happens what you do the decisions you make are going to define what your customer service really is under stress. So, I’m happy to say that I’ve got clients who are saying put their foot down on the gas pedal and saying go, go, go. I want to let people know I’m here for them and they’re doing consultations of business from home offices and Kitchen tables and things like you’re doing so it’s a great question. Thank you very much. We are out of time. I like to keep these, you know, no more than 30 minutes, but Leonard my friend. Thank you so much for getting up Ingenuity this morning and sharing your wisdom and experience with the market. Thank you for your time and allowing me to do this. Great. Thank you so much. I will talk to you soon, my friend. Take care. Thank you.

 

 

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