Covid-19 insurability: the short- and long-term impacts of Covid-19 on the insurance industry from business interruption claims

Abstract

The world has been destabilized with the outbreak of COVID-19. In the actuarial field, many papers are either focusing on the impact COVID-19 is having on the life and health side of insurance or only reporting on the cases against insurers in regards to the business interruption clause in the property and casualty track. The overarching goal of this paper is to use past instances of pandemic and other natural insurance losses to determine the possibility of a large loss to property and casualty insurance companies in response to their business interruption clause, the clause that insures businesses with day-to-day transactional losses due to damage to their property. Future research must be done when the dust settles and tangible data is available to be analyzed. For this reason alone, the method of triangulation of previous losses gives us the best insight into what the future will hold for businesses and insurers of business interruption lawsuits.