California Farmers and Dairy Farmers: Was Your COVID-19 Business Interruption Claim Denied?

COVID-19 has had an undeniable impact on business owners across the country, and it is no secret that farmers and dairy farmers are among the hardest hit. Tragic reports flooded the news this week about dairy farmers having to dump their milk. School closures due to COVID-19 have had a massively detrimental effect on dairies, as the school lunch program is one of the largest consumers of milk nation-wide. Additionally, with fewer and fewer people going to grocery stores due to COVID-19 shelter-in-place mandates, there are simply not enough consumers to purchase the milk that is being produced. Dairy farmers are now having to bear the cost of maintenance and production without any profit to offset it.

As one of the nation’s largest suppliers of produce, California farmers are particularly hard-hit by the COVID-19 pandemic. With an abundance of product, a short time to move the product before it expires, high operating costs, and a declining market, many farmers are turning to their business interruption insurance for relief.

Business interruption insurance (or “Loss of Business Income Insurance”), or may be referred to in some agriculture business insurance policies as a “Disruption of Farming Operations” provision, provides financial protection to businesses in the event that there is an unforeseen interruption to their usual income, such as theft, fire, or natural disaster. It is intended to return the amount of profit to the owner’s business that would have been earned had there been no interruption. In other words, it’s intended to give you the amount of money you would have earned if there was not a COVID-19 pandemic or related industry COVID-19 business closures.

While it is an extremely stressful time for many farmers, it is also exactly the kind of time business interruption insurance was designed to provide financial protection for. This has prompted many farmers with such policies to file claims, only to find that their insurance company is unilaterally denying coverage for all COVID-19 business interruption claims. This leaves already struggling farmers without the protection they have been paying for every month (sometimes for years), and without the resources they need to continue operating and producing food to feed our nation’s families.

If you have a valid business insurance policy, you may be entitled to coverage for damages resulting from the COVID-19 pandemic, including coverage for loan payments, profits, employee wages, rent, and other costs associated with the interruption, for up to 12 months, depending on your policy.

Specifically, you may be eligible for coverage if:

• Your valid business insurance policy includes coverage for business interruption or loss of income.
• You are a California business owner.
• You can demonstrate significant financial losses due to the COVID-19 pandemic or the government-mandated shut-down.

Whether you are entitled to coverage, and how much you are entitled to, will come down to the exact terms of your particular insurance policy. For instance, some business interruption insurance policies exclude losses from viruses, bacteria, and other microorganisms, but many do not. It is also important to note that even if your policy does exclude losses from viruses, there are still many ways that coverage may be available to you. As an example, your policy may exclude viruses but not government-mandated shutdowns.

The only person who can really tell you with certainty whether you are entitled to coverage is an experienced California Insurance Attorney. At Boertje & Associates, we are ready to fight for you and aggressively pursue the proper amounts you are legally entitled to on your policy and the protection you are entitled to so you can keep your farm or dairy going strong.

Additionally, through a strategic partnership Boertje & Associates is working alongside one of the premier and most well known insurance coverage lawyers in California who has over 30 years of experience handling insurance coverage issues and insurance bad faith claims and litigation.

Please contact us if you would like us to review your policies. We will review and evaluate your policy for FREE regardless of whether you decide to ultimately pursue your insurance claim, so that you may know all the options available to you. Should you decide to have us handle and pursue your farm or dairy’s business insurance claim, we will be handling these cases on a pure contingency basis, which means there will be no attorney fees unless we recover. Our fees would be taken out of any settlement of judgment on an agreed upon contingency fee basis. Time restrictions apply for filing your claim pursuant to California law and also pursuant to time limitations contained within your policy, so schedule a free consultation as soon as possible.