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Is there any insurance coverage for the consequences of COVID-19?

Please review this article in yesterday’s Wall Street Journal for more information (non-paywall version here), and bear in mind that most, if not all, including the policies in the MJ Sorority program, contain similar verbiage regarding business interruption and civil authority.  The Property policy includes Loss of Income coverage, which provides coverage for your ongoing and extra expenses, but only following a covered property loss.  For example, if you would have a pipe burst that would cause you to have to remove several women from their assigned rooms.  If they were required to find alternate housing on their own, the policy would provide that lost income.  More commonly, especially for a short term, the House Corporation would find alternative housing, such as at a local hotel, and the policy would pay the difference between what the women are already paying for and the cost of the hotel.  

However, the policies require that property loss trigger before they provide payment.  Unfortunately, there isn’t any coverage in the policy for the situation in which we now find ourselves because there has not been a defined property loss. This is a good time to review your housing and employment contracts to see if/how unexpected house or university closings are to be addressed. 

Read this bulletin for further information or watch our recorded webinar.

What should we consider when closing the house in light of COVID-19?

It appears that most universities will close for the remainder of the semester, and we are recommending that our clients follow suit. Some things to keep in mind:

  • This is such an overwhelming and stressful time for all of those involved: House Corporation volunteers, employees, and members. It is important that House Corporations and property managers clearly communicate to their employees and member residents about procedures and expectations.
  • We are encouraging House Corporations to schedule move-outs in a staggered way, so as to minimize the number of people in the house at any time.
  • As always, the insurance program does not cover member’s personal property. If member’s personal property is damaged, they will need to rely on their parent’s homeowners’ insurance or a rental policy.
  • We typically recommend that House Corporations do not store member’s personal property, but these are extraordinary circumstances. If you do allow members to leave their personal property, do your best to make sure the property is secure, just as you would for summer break.
  • We recommend a thorough cleaning of the property before reopening based on CDC guidance.