The Legal Challenges of Insuring Against a Pandemic

COVID-19 has raised, and continues to raise, questions about the traditional approach to insurance cover. For instance, business interruption insurance covering “pandemics” under all risks insurance policies are likely to be a thing of the past. With tensions between businesses and the insurance industry on the rise, what can be done to offer businesses some protection at a premium they can afford, without emptying insurers’ reserves? In this chapter we talk about legal challenges related to traditional insurance against the risk of losses caused by a pandemic, and whether parametric insurance is the solution.

DIAGNOSIS OF BUSINESS INTERRUPTION RISK USING EXPRESS-TESTING OF SETTLEMENTS WITH DEBTORS

Considering the indicators of business interruption risk from the point of view of the users interested in stability and observance of business continuity conditions, it is worth estimating the potential possibilities of accounts receivable recovery, as well as the risks connected with the increase of bad debts sums

Assessment of the risk of interruption of the organization‘s activities and disclosure of information about it in the financial statements

The accounting and non-accounting indicators of the risk of interruption of the activity of an economic entity are considered, derived on the basis of a study of the content of regulatory legal acts that establish the conditions for continuing activity, accounting standards and auditing standards. A system of point assessment of the risk of business interruption is proposed and the directions of presenting information about it as part of the explanations to the accounting (financial) statements are determined. The proposed method of risk assessment can be useful for improving the information capabilities of accounting (financial) statements from the positions of key stakeholders.

OSIGURANI RIZICI U OSIGURANjU PREKIDA POSLOVANjA

Business interruption insurance is a type of insurance that covers the loss of income when a company suffers a catastrophic event such as natural disaster, massive fire damage or a huge machinery failure. Closing of the business facility due to the rebuilding process, which is typically considered only property damage in insurance terms, actually has far greater impact on any company as a whole. Many owners, managers and chief executive officers view business interruption insurance predominantly as expense, but global market trends require such policies to be implemented as key basis for modern risk management. For croatian insurance market business interruption policies are still developing as a tailor-made insurance product, while in European insurance market they are considered common business practice. This work is an overview of essential factors which determine business interruption insurance.