Policy Limitations
When businesses close as a precaution ahead of planned civil unrest, standard property damage and business interruption (BI) policies typically do not respond to lost trade. Tony Collman, property VP for speciality lines at Intact Insurance, explained that standard wordings require either physical damage or a direct order from a public authority to trigger extensions such as prevention of access or non-damage denial of access. Social media speculation or voluntary shutdowns by proprietors do not meet these contractual triggers.
Alternative Cover
Where standard BI policies fall short for precautionary closures, businesses can explore the specialist parametric market. Parametric policies pay out when a pre-agreed verifiable event occurs—such as a specific weather warning or a measurable drop in footfall—rather than requiring underlying property damage. Brokers advise firms considering closure to review policy wordings and consult local authorities before making operational decisions.