Business Disruption and Loss of Revenue Claims

The most recent updates from the CDC have lead to a series of changes to our everyday life. Counties closing events including ten or more people, cities completely shutting down and schools working to provide distance learning the remainder of the year. It is almost like overnight the way we interact and do business has been catapulted into this fully virtual space, which even the best risk analyst couldn’t have predicted.

We previously mentioned business disruption insurance claims and the possibility to recoup some loss, however, new information has come to light after our meetings with several brokers and review of such policies. Currently the wording in most business disruption insurance and loss of revenue DO NOT apply to this situation (Be sure to confirm the details of your policy with your broker). Viral infections are not considered a natural disaster or a physical loss leading the the reduction in revenue at this time. In the world of insurance, this is no different than all of your employees getting a cold at the same time.

So this has raised some discussion amongst our group and our peers of how do we move forward. HR 6201 is in the works and aims to provide additional funds into SNAP, WIC, Emergency Food assistance program, OSHA increased regulation for healthcare workers protection, and employee protections. While this is extremely helpful to many people, there is also a large unaccounted for group within the small business world that will not meet qualifications for such programs as WIC and SNAP. Even with loss of income because they still have vehicles in their name that are valued too high, or they were single member LLCs/DBAs paying themselves irregulars their income and net assets are usually overstated. (Not something we recommend but it happened a lot!)

HR 6201 also does require employers to provide paid sick leave to employees but what about small businesses that utilize a combination of employees and contractors? The profit is on the work performed by the contractor so it would be impossible to afford paid sick leave for most small businesses.

What about small businesses that are customer facing companies, unable to invest the funds to turn into an online store overnight? The have personal guarantees on leased spaces and LOCs and if they just shut their doors, what help is there or consideration when they have to file bankruptcy?

This is all overwhelming and I do believe HR 6201 is a great start, but it doesn’t help the core of our current economy which are the men and women who own these small businesses. Jessecure, in collaboration with many other great talents across the U.S., are focused on finding our own solution instead of waiting on others to do it for us. Innovation has always been what separated America from the rest of the world over the past century, and with globalization of business and technology we are in a better place then ever to take cloud-based business management to the next level.

Jessecure started solely as a way to find out how to deliver all business support services, across the world, completely virtual. I believe we have found how to do that and how to covert other small businesses in a quick and cost effective way. The days of $10000 websites and $40000 software conversion projects are not the standard anymore and we can guide your company into future of business.

 

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