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Is your business interruption insurance not paying off?

Business interruption insurance claims are being denied based on the lack of physical damage when it comes to COVID-19 claims. Local officials stress the importance of filing claims as soon as possible and, if denied, filing a complaint with the Texas Department of Insurance ad the Office of Public Insurance.

Any business, big or small, with business interruption insurance should immediately read the policy, consult with their agent or an attorney, and file a claim if applicable. When that claim is denied — and about 90 percent of all business interruption insurance claims dealing with COVID-19 restrictions ARE being denied — then file a complaint with the Texas Department of Insurance or the Office of Public Insurance Counsel.

“Some of our businesses, some of our restaurants and individuals have been told no — the (insurance companies) say, ’You have it (business interruption insurance), but we’re not paying,’” said state Rep. Todd Hunter (R-Corpus Christi) during a Zoom panel discussion on the issue hosted by the United Corpus Christi Chamber of Commerce on Tuesday, April 21. “One of the exclusions is the issue of physical loss. Physical damage is being used as a basis to deny claims.”

A number of Galveston-area business owners and chamber members were also on the Zoom meeting, which included their local state representative, Mayes Middleton (R-Galveston).

“So many people have reached out to me and said their business interruption insurance has been denied,” Middleton said. “I’m told 99 percent of restaurants are being denied, and that’s shocking. This situation we are in IS a business interruption. We have been shut down.”

Two attorneys on the call, Kathryn Snapka, whose family owns Snapka’s Drive-In restaurant, and Bill Chriss, explained the process but didn’t leave much hope for restitution.

“I don’t want to leave you with the false impression that filing a complaint with the Texas Department of Insurance or a complaint with OPIC is actually going to get your claim paid,” Chriss said. “I’m 99 percent sure it’s not. To get redress for the denial of your claim, you have to file a lawsuit.”

However, having that claim on file with TDI will make a difference in the long run, especially when it comes to seeking changes either through legislation or administrative rulings by TDI or Governor Greg Abbott.

Melissa Hamilton from OPIC, an organization created to represent consumers when it comes to insurance issues, reiterated the importance of filing a claim as soon as possible.

“Every policy is different,” she said. “Read your policy, sit down with an agent, and discuss that policy with them. Then, file your claim. One thing we look for is that the insurance company does a thorough investigation before they deny or accept a claim.”

For more information about how to file a claim with OPIC, visit the website, email help@opic.texas.gov, or call 877-611-6742.

“We need to get your feedback,” Rep. Hunter said. “I don’t want this to be a stumbling block for getting better. Let’s set the stage so we are getting information on every level.”

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