New guide: A Forensic Accounting Perspective on the Expected Increase in Business Interruption Claims Related to the COVID-19 Pandemic
The insurance industry is bracing itself as concerns over the coronavirus (COVID-19) pandemic have intensified with an increasing number of cases reported across the globe. According to the Center for Disease Control (CDC), the virus is “an emerging, rapidly evolving situation” for which complete details are not yet known. Therefore, while it is difficult to gauge the full implications the virus will have on a global scale and on the insurance markets, we can look at the information we do have and use our prior experience with catastrophic events such as 9/11, Hurricane Katrina, and Deepwater Horizon to prepare as much as possible for what may come.
Impacts on Business
The COVID-19 impact across the globe may affect the way business is conducted forever. We were sorely unprepared for a pandemic of this magnitude. Fortunately, our government and business leaders have banded together to protect the population, the healthcare system, and the economy from collapse by implementing policies including social distancing and work from home.
Although these policies are almost certainly necessary in restricting the spread of the virus, they will have serious and lasting effects on the economy.
Possible Impact on Insurance Industry
While it may not be flashy or exciting, the insurance industry forms the backbone and safety net of the economy. With small businesses across the U.S. being pushed to the brink of closure on the heels of this pandemic, we are seeing more and more lawmakers debate and articles discussing the role of insurance in keeping businesses afloat. Business owners rely on their insurance policies to provide the financial restitution to continue paying their employees and keep their doors open following recovery from catastrophes.
During this difficult time, policyholders will be submitting insurance claims stemming from travel cancellations, interruption in business activity, decreased productivity, and supply chain issues that negatively affect their business’ performance. Subject to available coverage or legal mandate, the insurance industry will need to respond to these claims.
Industries Impacted
In order to provide timely and accurate claims resolution, each industry and each business must be analyzed based on the unique scenarios they face in the wake of this pandemic.
We feel the following 7 industries will be most impacted by COVID-19. As such, we tapped into the extensive collective experience of our executive forensic accounting team to outline an overview of the potential impact, expert insights, and key considerations to help you better support your policyholders.
1. Hospitality
2. Restaurants
3. Retail
4. Gig Economy
5. Legal and Financial Services
6. Medical
7. Entertainment/Event Venues
Download “COVID-19: The Business Interruption Guide to Calculating Economic Damages”
By downloading the report you’ll Learn:
- Expected impacts on business and the insurance industry
- 7 industries we feel will be most impacted
- Expert insights and key considerations for highly-impacted industries
- How to help protect your organization, policyholders, friends and family from COVID-19-related fraud
- How to approach the likely rise in litigation stemming from COVID-19 damages
- How automation and AI can help you manage the impending volume of claims
Other Business Interruption related articles:
When Catastrophe Strikes: The Cost of Business Interruption
Business Interruption: 40% to 60% of small businesses never recover after a disaster
