Mr Fuller said businesses would be priced out of insurance if generic policies extended to all unpredictable events – such as pandemics and civil war. “If you want insurers to cover everything you’re going to have to have very deep pockets.”
While the extent of potential coronavirus-related claims are not known at this point, the council has set up a taskforce to measure the number of coronavirus-related claims to inform the industry position in the future.
Insurance giant IAG said the spread of human and infectious diseases was among general exclusions that may impact cover, but a spokesperson said claims would be assessed on a case-by-case basis.
“We encourage any business with questions on scope of their cover to contact their broker or insurer,” the IAG spokeswoman said.
Cities around the world have been sent into lock-down to prevent the spread of the deadly virus that has now infected more than 118,000 people in 114 countries and has caused events to be cancelled and businesses to shutter their doors.
Tasmania’s winter folk festival Dark Mofo is the first of Australia’s major events to be cancelled with art mogul David Walsh declaring he would “rather be a rich coward than a poor hero”.
“Right now, the government and [Hobart’s contemporary museum] Mona are each on the hook for $2 million to run Dark Mofo. That’s bad,” Mr Walsh said in a statement.
While Mr Fuller said there is sometimes an expectation gap between policyholders and the extent of what is covered, the information about exclusions are embedded in product disclosures and communicated by insurance brokers.
“This is actually an opportune time for businesses to examine their risk identification processes and talk to their insurance brokers about their specific needs and the ways in which insurance can help them offset or manage those risks.”