Coronavirus – Employee Benefits & Insurance ImplicationsNot surprisingly there is considerable coverage of the coronavirus (COVID-19 to give it its official name) outbreak throughout the worldwide media.
In the age of 24-hour rolling TV news coverage, we are never more than about 15 minutes away from the latest figures for infected people, locations and individuals in quarantine/self-isolation from CNN, Sky, the BBC, etc.
As in previous similar situations, this new virus, not previously found in humans, has caused significant panic, fear and confusion among people of all age groups in China and further afield as the contagion spreads via our interconnected communities worldwide.
Feeding the concern is the unknown; currently clinicians can’t confirm accurately the infection rate or its extent of lethality. Scientists are working hard to determine these factors, but concrete information is still not established. Many commentators are therefore referring to the fact that this virus is part of the ‘family’ that includes SARS ( Severe Acute Respiratory Syndrome) and MERS (Middle East Respiratory Syndrome) and drawing obvious, deadly, conclusions without mentioning that many forms of common cold are also ‘family’ members.¹
This article isn’t intended to look at all the clinical details of the outbreak; instead I’m focusing on the implications for organisations and insurances they might utilise to protect their employees.Duty of care
Although the exact wording and regulations will vary from jurisdiction to jurisdiction, there is generally, around the world, legislation that places a duty of care on employers to keep employees safe and healthy while at work. For example, in the UK, this duty is enshrined in The Health & Safety at Work Act 1974 and is described by the Health & Safety Executive below:It is an employer's duty to protect the health, safety and welfare of their employees and other people who might be affected by their business. Employers must do whatever is reasonably practicable to achieve this.This means making sure that workers and others are protected from anything that may cause harm, effectively controlling any risks to injury or health that could arise in the workplace.Employers have duties under health and safety law to assess risks in the workplace. Risk assessments should be carried out that address all risks that might cause harm in your workplace.Employers must give you information about the risks in your workplace and how you are protected, also instruct and train you on how to deal with the risks.²
This would, obviously, require employers to ensure that employees who are likely to come into contact with the virus are protected, instructed to self-isolate, evacuated from the infected area, etc.
Where companies are sending employees overseas either on business travel or expatriation, businesses may rely on travel insurance and/or international medical insurance to offset their responsibilities under duty of care. However, in the current circumstances, this may not deliver exactly what is required, and clients need to be aware of how insurance provision may be affected by State intervention.Travel insurance
Almost all personal and business travel insurances have exclusions once official warnings have been issued. In the UK these official warnings are issued by the Foreign & Commonwealth Office; in the US it’s the State Department.
The current (2 Feb 2020) State Department warning in relation to China is:Do Not Travel……Travelers should be prepared for the possibility of travel restrictions with little or no advance notice. Most commercial air carriers have reduced or suspended routes to and from China.Those currently in China should attempt to depart by commercial means. U.S. citizens remaining in China should follow the U.S. Centers for Disease Control and Prevention (CDC) and Chinese health authorities’ guidance for prevention, signs and symptoms, and treatment. We strongly urge U.S. citizens remaining in China to stay home as much as possible and limit contact with others, including large gatherings. Consider stocking up on food and other supplies to limit movement outside the home. In the event that?the situation deteriorates further, the ability of the U.S. Embassy and Consulates?to provide assistance to U.S. nationals within China may be limited.³
This type of official warning will trigger exclusions on travel insurance. This normally doesn’t impact people already overseas (however, see potential restrictions below), but companies who have staff travelling would be well advised to check with their travel insurance provider and of course follow Government advice, especially in relation to those employees who have not yet left their home country. Asking or expecting an employee to travel against Government advice would be a clear breach of duty of care.Medical evacuation and international medical insurance
One of the issues that often comes up in relation to international medical insurance when dealing with a crisis such as an epidemic, is access to private treatment in affected areas and/or if an employee is suspected of being infected.
Key points for consideration:
a) Most international medical insurance policies don’t cover non-medical evacuation. If they do cover non-medical evacuation, it is normally an additional option at extra cost. Under the standard cover the member must be ill in order to be evacuated. There are specific assistance companies who will provide evacuation in non-medical circumstances; however, evacuation (medical and non-medical) will be impossible once the authorities have taken control of an area, as is the case in China at the moment. Once the Government enforces travel restrictions, any evacuation will need to be pre-approved by the authorities.
This will also apply to non-virus related issues, e.g. an employee involved in a car crash can’t be evacuated from Wuhan because the authorities are strictly controlling air and land transport into the affected regions.
b) Most medical insurance policies have exclusions once an epidemic/pandemic is brought under public/State control. Even if private hospital facilities are available (either in infected areas or elsewhere), members with suspected coronavirus may not be able to access them via their insurance due to quarantine and movement restrictions in place. UK health insurer Aviva has advised:Should an Aviva policy holder contract Coronavirus, it would be highly unlikely they'd be treated in any of the UK private hospitals as these hospitals are not properly set up for patient isolation.4
This is likely to be the case worldwide. With health authorities looking to curb infection rates, any options for treatment will be strictly controlled and requests from insurance companies won’t be dealt with.What’s next?
The situation in China continues to cause concern. Many Governments have issued voluntary evacuation advice to their citizens to leave China if possible. Companies with expatriate employees in China should assist their staff in complying with these instructions. In addition, as the outbreak spreads, companies should keep a ‘weather-eye’ on advice issued by Governments, NGOs, insurance companies, etc. so they can take proactive steps should the infected area extend beyond Chinese borders.