The outbreak of the coronavirus (COVID-19) in Wuhan, China, in December 2019 has continued to develop with documented cases now reported all around the globe. Cities around the world have been sent into lock-down to prevent the spread of the COVID-19 which has now been deemed by the World Health Organisation as a pandemic.
The World Health Organisation works worldwide to promote health, keep the world safe, and serve the vulnerable. A pandemic is declared when a sudden emergence and rapid worldwide spread of a new infectious disease poses as a significant risk.
How does Travel and Business Interruption Insurance most likely respond to claims relating to a Pandemic.
Many travel insurance policies have a specific exclusion for ‘pandemics’ and claims arising from ’known events’, which means that cover may not be available for cancellation, medical and/or emergency evacuation.
What you should do before you travel:
- Review your Policy Disclosure Statement and discuss with your insurer or broker whether what cover is available before you travel.
- Refer to the smartraveller.gov.au website. It is important that you read and understand the advice level for the country you are planning to travel to. These advice levels reflect the risk associated with the country, which affects your safety and travel insurance.
- If government issues a ‘do not travel’ advice as a result of a pandemic, travel insurance may cover a traveller for trip cancellation costs, depending on when the policy was purchased and what general exclusions the policy contains relating to claims for pandemic or epidemic.
- If an Australian who is already travelling falls ill as a result of a pandemic, their travel insurance may cover medical treatment overseas and medical evacuation to Australia if covered by their policy.
- Many travel insurance policies do explicitly exclude any claims related to pandemics. Once a traveller returns to Australia, or if symptoms only present on home soil, the traveller is covered by Medicare.
Business Interruption Insurance:
Business interruption insurance policies typically cover loss of income during catastrophic events or disasters. However, most policies will exclude cover once declared by the government that the disease is a pandemic or communicable disease.
If your business is exposed to the impact of the Corona Virus, you should:
- Review your Policy Disclosure Statement and discuss with your insurer or broker whether there is any cover in place.
Government Economic Response to the Coronavirus
The Australian Government has announced an economic response totalling $17.6 billion across the forward estimates to protect the economy by maintaining confidence, supporting investment and keeping people in jobs.
Additional household income and business support will flow through to strengthen the wider economy.
The Government’s economic response targets four key areas:
- Delivering support for business investment
- Cash flow assistance for employers
- Stimulus payments to households to support growth
- Assistance for severely affected regions
For further information, please click the link above and download the fact sheets that may be relevant to you.
Keeping Up to Date
Businesses should keep up to date with the latest COVID-19 information and advice to ensure that any action taken is measured and appropriate. This includes closely monitoring the Australian Government Department of Health, the Smartraveller website and any advice from state or territory government agencies.
Disclaimer – “This material contains general information only and may not suit your particular circumstances. To decide if a policy is right for you please carefully read the relevant Product Disclosure Statement (PDS) and/or Policy wording. While we have exercised due care and skill in preparing this information, Optimum Insurance Services (Optimum) does not accept any legal responsibility or liability for negligence or otherwise to you or anyone else who seeks to rely on this information. This includes, without limitation, loss arising from a possible failure of the information to comply with statutory or regulatory requirements or the failure of the information to identify other terms and conditions beyond those considered in this document. You should obtain advice to ensure that your policy provides adequate cover for your circumstances.
“Optimum Insurance Services Pty Ltd is a Corporate Authorised Representative of Insurance Advisernet Australia Pty Ltd (Car No. 291220), Australian Financial Services Licence No 240549, ABN 15 003 886 687.”