Polsinelli presents Crisis Management: a multi-part series (culminating in a webinar on 11.20.2014) on what companies must know to stay ahead of external interruption that risks serious impact to their business concerns. First in this series, Richard Giller of the Insurance Recovery practice explores Ebola's implications on coverage exposure:

The potential insurance implications of the worldwide Ebola crisis may be as far reaching as the virus itself. In addition to its human toll, businesses should not ignore the potential financial ramifications associated with Ebola including, among others, lost profit claims, business interruption losses, claims resulting from government mandated closures or evacuations, negligent exposure/diagnosis claims and cleanup costs.

By way of example, two travel companies may have significant insurance claims that they most likely never anticipated.

• On October 17, Mexico refused to grant permission for a Carnival Cruise ship to dock off the coast of Cozumel. The ship was carrying an American health care worker who had handled clinical specimens from the Ebola patient who died in a Dallas hospital on October 8th. The passenger was voluntarily isolated on the ship and was asymptomatic, but after being refused docking by the Mexican government the cruise ship was required to return to its home port in Texas. In addition to its existing compensatory offer of $200/person and a 50% discount on a future cruise, the cruise line may face additional claims from passengers whose vacations were cut short.

• Two days earlier, Frontier Airlines announced that it was grounding the Airbus A320 airplane that had transported one of the nurses who had treated that same Dallas Ebola patient back to Texas. The airline may experience lost profits from taking the plane out of service. Airline industry stock prices have declined in recent weeks, with some analysts blaming Ebola. A New York Stock Exchange index of airline stock is down 11.5% over the last month.

The potential Ebola-related insurance claims are varied but, in addition to the business interruption losses noted above, could include wrongful death claims, negligent exposure or diagnosis losses, and clean-up or disposal costs. Whether such claims might be covered by a company's existing policies depends, as with most insurance coverage issues, on the wording of those policies and the coverages provided.

To minimize exposure, liability insurers might seek to exclude Ebola-related claims under several standard exclusions in CGL policies, including the expected or intended exclusion or the pollution or bacteria exclusions. Similarly, workers' compensation carriers might seek to exclude coverage because of a failure to comply with health and safety laws or regulations. Finally, because business interruption coverage usually requires a direct physical loss to the covered premises caused by a delineated peril, the question might arise as to whether an Ebola-related closure constitutes direct physical loss of premises.

Companies should carefully review their current property and casualty, workers compensation and professional liability policies, among others, to determine whether coverage might be excluded for Ebola-related risks. Further, hospitals and health-care facilities are not the only businesses that might be adversely impacted by such claims. Others include transportation companies, hazardous waste removal companies, and any business that might have an employee, client or visitor test positive for Ebola.