Coronavirus (COVID-19) – the construction industry and insurance

One of the questions that we are being asked is will insurance cover the delay/suspension/cessation/termination of construction works as a result of Coronavirus (COVID-19).

Whilst it will depend on the wording of each policy, the general position is that insurance is unlikely to cover such a situation. This is because only insured perils are covered by insurance policies.  Bearing in mind how recent our awareness of Coronavirus (COVID-19)  is, it is unlikely that it has been included as an insured peril in insurance policies.

As an aside, one point that is causing some confusion is the use of the word “notifiable”.  The Government declared last week that Coronavirus (COVID-19)  was a notifiable disease. Insurance policies often specify certain diseases that are covered (sometimes defined as “Notifiable Diseases” in the policy) but the diseases that are covered are limited to those named in the definitions section of the policy and will not include COVID-19. The fact that the  Government has declared that the virus is a notifiable disease does not alter the overall position that insurance is unlikely to cover the Coronavirus (COVID-19) pandemic.