Coverage Guidance

Last updated: March 23, 2020

Special Note

Like many of you, we have been monitoring the rapidly developing issues surrounding COVID-19. The outbreak has had tremendous effects on districts and rest assured we are looking out for you. We are working to build flexibility into our programs to help you cope with this crisis.

Safety Grant Program Expansion

Many of the precautions you are taking may be eligible for Safety Grant reimbursement. This opens up the nearly $4.8 million in member allocated funds for COVID-19-related issues like facility deep cleaning, costs associated with social distancing, and personal protective equipment. Effective immediately, all COVID-19-related loss prevention expenses are 100% reimbursable through the Safety Grant program subject to your district’s balance. Note that some exclusions still apply, such as payroll, lost income, and insurance costs. For more information, contact us. To apply for a grant, click here.

Workers’ Compensation Adjustments

The Pool will adjust Workers’ Compensation contributions if a reduction in your anticipated annual operational payroll will result in a $1,000 or greater decrease in contribution where the district is dependent upon user fees and if services have been interrupted or discontinued. For more information, contact us.

Coverage Information

As your partner in risk management, our underwriting team has been asked to comment on coverage as it relates to COVID-19. Underwriters are not claims adjusters or attorneys, so we cannot provide specific legal advice. We can, however, restate statute and coverage in the plain text to help walk members through our methodology. It is not uncommon to have differing opinions and the coverage offers resolutions for disputes. To guide you through a few hot topics, we have prepared this overview to provide information regarding coverage in light of the COVID-19 public health crisis:

Workers’ Compensation

Workers’ compensation claims regarding COVID-19 should be handled like any other WC claim. An employee making a claim must prove that the COVID-19 infection arose in the course of their employment. This is the same as other types of workplace exposure to contamination or illness. A worker who can trace contraction of the virus to a particular time, place, and cause in the workplace may have a compensable claim. One thing to note is that as the virus spreads throughout Colorado, it may be difficult for a worker to prove COVID-19 was contracted at work versus elsewhere in the community. That said, under the new Federal Act, COVID-19 testing is mandated to be cost free from health providers. Therefore, being tested by any health provider rather than your preferred workers’ compensation physicians is waived for COVID-19. If you have not already done so, your district should consider requiring employees to comply with COVID-19 safety guidelines, especially if you provide services for which the CDC has provided specific guidance (like healthcare providers and first responders). Following those guidelines may be the best way of keeping your employees safe. If the cause of the infection was not work-related, there is no recourse under workers’ compensation. This is true even if an employee who is sick with or exposed to COVID-19 is ordered to stay home. Therefore, if you receive questions from employees pertaining to COVID-19-related leave, you should look at what your benefits package provides and speak with an employment law expert regarding sick leave or other types of benefits. We suggest referring to the HR attorney hotline on our HR Helpline. For Pool members, there is no cost for these legal consultations. We are also making the attached analysis regarding the Families First Coronavirus Response Act from our workers’ compensation attorney’s at Dworkin, Chambers, Williams, York, Benson & Evan, PC available to all members for review here. If a district’s revenue has been impacted and payroll has been affected we can work with members to make midterm adjustments to account for the reduction in annual contributions.

Cyber Liability

Many districts are asking employees to telecommute to respond to federal, state, and local emergency orders. When asking any employee to telecommute, make sure to follow basic guidelines to minimize the risk of a data breach:

  • Verify the installation of up-to-date security software on all district-owned equipment
  • Ask that employees verify that any personal devices are up-to-date
  • Remind employees of the types of information they should safeguard with respect to any district owned laptops
  • Advise employees they are not to share district-owned equipment with others
It is important to remember that cyber security measures are still required when working remotely. COVID-19-based phishing and social engineering attempts are becoming more common. Remind employees to stay vigilant to avoid these attacks which have been said to include potentially damaging links to information promising more information about the virus, or information about cures, vaccines, etc.

Cybersecurity and Infrastructure Security Agency (CISA) encourages all of us to take the following precautions:

  • Avoid clicking on links in unsolicited emails and be wary of email attachments
  • Use trusted sources – such as legitimate, government websites for up-to-date, fact-based information about COVID-19
  • Do not reveal personal or financial information in email, and do not respond to email solicitations for this information
  • Verify a charity’s authenticity before making donations and do so only on a personal device

Property and Business Income

Federal, state, or local governments may advise or mandate that you restrict access to your facilities to protect public health and safety. This will certainly impact districts; especially any that derive revenue from the use of their facilities. A claim for lost business income due to COVID-19 would be handled like any other property loss or damage claim. In general, we can provide information regarding Business Income and if coverage could be triggered. A “Covered Cause of Loss” (defined in the form) is tied to physical damage to real or personal property (“Covered Property”). Many public entities are serving public health and safety by closing their facilities and/or cancelling events in response to COVID-19. In general, interruptions to these public activities (which may reduce business income) are not related to any kind of physical damage. Therefore, Business Income coverage would not be triggered. When a district’s operation is interrupted by a civil or military authority prohibiting access or granting limited access (ingress/egress) to a district’s premises (or within one mile of its premises), it must also be a result of physical damage to “Covered Property” from a “Covered Cause of Loss.” Current mandated closures are not in response to physical damage of real or personal property therefore, again, Business Income coverage would not be triggered. The CSD Pool’s coverage form is consistent with the global insurance market that considers most COVID-19 Business Income losses uninsurable because there is no direct physical loss or damage to its real or personal property. But this is a unique, fluid situation and as things change, we will continue to keep you updated. If you have any further questions or concerns, please contact us.