Are businesses covered for damage caused by the Freedom Convoy?

More than a week after the “freedom convoy” rolled into Ottawa, some in the P&C industry are discussing whether or not business interruption claims due to civil disobedience are insured risks.  

Ottawa’s downtown centre has been paralyzed with vehicles and tents blocking roads for days, as protestors call for an end to Ottawa’s COVID vaccination mandates. And some P&C industry observers believe insureds who would like to claim business interruption losses may not be covered under their policies. 

“Let’s just say [for example, that] there isn’t any damage that occurs, it’s just the business owner that decides to close up shop for a week because they’re nervous for themselves or their staff safety….How do they recoup the lost earnings as a result of that?” Bryan Yetman, president at First Durham Insurance poses.  

“There may be coverage if these people are forced to close by civil authorities and those sorts of things. But again, that’s a maybe. I would think there would be businesses that may not necessarily have any coverage, because they’re not forced to close, and no damage occurs. So, business interruption coverage may not even be available to those individuals, even if they had the coverage.” 

Even though Ottawa declared a state of emergency on Sunday, Yetman says this may not mean policyholders can claim business interruption.    

“It is never clear-cut,” he told Canadian Underwriter. “Some may have an extension that triggers BI resulting from shut down from civil authority. But in these situations, some of these coverages still require some form of property damage to have taken place within a specified radius,” Yetman says in a follow-up email. 

When asked if she anticipated any claims to come through, Carole Desjardins, director at G.A Desjardins & Son Inc., says she doesn’t think they will. “It’s an exclusion,” she says. “So, I don’t know, I don’t think they can even claim business interruption.  

“It is definitely impacting the community. It’s definitely impacting businesses,” she says. “The Rideau Centre, for instance…that’s closed.” 

What’s more, brokers say that damage caused by acts of civil disobedience is not typically an insured risk.  

“Most policies won’t pick that up. It’s one of the exclusions,” Desjardins says. 

Yetman adds there may be carriers out there whose policies may exclude claims arising from ‘riots.’ 

I can’t speak to every policy,” Yetman says. “Things that are typically damaged as a result of [riot and war] are typically things that are excluded. So, you could have insureds out there that absolutely would find themselves without coverage.”  

So far, the Ottawa police service announced they have made seven arrests and issued more than 100 tickets due to demonstration-related activity. There are currently more than 60 ongoing criminal investigations stemming from the demonstration, primarily for mischief, thefts, hate crimes and property damage. 

Despite this, local brokerages have not seen claims as a result of the occupation. 

One brokerage close to the Ottawa-Gatineau border says that they have not received any claims as of today.  “There’s no claims,” Desjardins reports thus far.   

But the occupation has had other effects on nearby brokerages. “We’re close by where the rally is….Some clients can’t get to us because of the bridges on the Quebec side, most of them are closed. Only two are open,” Desjardins adds.  

“Some [staff] live on the Quebec side. So, what takes about 20 minutes to get to work, it took two hours,” she said last week when the convoy first entered the city.  

Another Ottawa brokerage, who wished not to be named, noted off the record that as of last week they had also received no claims.  

More information to come as this story develops.  

Feature image: A person holds a sign for the “Freedom Convoy” a cross-country convoy protesting a federal vaccine mandate for truckers, as people rally against COVID-19 restrictions on Parliament Hill in Ottawa, on Saturday, Jan. 29, 2022. THE CANADIAN PRESS/Justin Tang