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Fire Protection District Insurance Considerations with COVID-19

Friday, April 24, 2020
Fire Protection District Insurance Considerations with COVID-19

While some Illinois citizens have the privilege of working from home while watching Tiger King, there are others who are facing all that COVID-19 has to offer head-on. That is why Governor Pritzker announced on April 14 that all essential employees in Illinois could be eligible for workers’ compensation benefits if infected with COVID-19 in the scope of their work. Since then, the scope of who will be covered has narrowed, but first responders will still be eligible for coverage.

As of today, three firefighters in the state of Illinois that have passed away due to complications from COVID-19. The families of both will receive line of duty benefits that include one year’s salary and funeral expenses. The Chicago Fire Department has stated that they will assist the families in receiving other benefits that are afforded to those who have died in the line of duty. However, if COVID-19 is covered under workers’ compensation, the question begs to be asked if the families are also eligible for death benefits from the insurance companies as well. This has not yet been clearly outlined by the state, but if it is included, a death claim for an individual with a family could start at around seven figures.

Regardless of whether your district has had a staff member test positive for COVID-19, there are steps that you should be taking right now to smooth the processing of a claim:

  • Have an exposure control plan that addresses training staff on preventing the spread of the virus
  • Rigorous documentation of all member’s testing for the virus
  • Keeping an eye for “known exposure” to limit a chain of claims

Looking further down the road, there are also fiscal consequences of the virus that will most likely show up in Fire Protection Districts Insurance renewal pricing.

  • Slowing economy and low interest rates limiting investment income for Workers’ compensation carriers
  • Cost of claims from COVID-19 being passed on to districts through increased premiums

Another important point to be noted here is that all claims around COVID-19 will have a high amount of indemnity, being that any infected employees are unable to return to work for light duty. This will increase the amount of time that Workers’ Compensation will need to be paid out to the employee.

This would be coming at a time when some districts may even be forced to propose budget cuts in the wake of the pandemic. In fact, states on the west coast that are “sales tax dependent” are looking to propose budget cuts anywhere from 10-25%. Whether or not this will ripple across the country to Illinois remains to be seen.

Where we can help

The Horton Group’s Public Sector Practice Group has been working vigorously with clients to assist in submitting claims and other questions about COVID-19. Please reach out if you have any questions around COVID-19 or insurance in general. We are more than happy to help.

Material posted on this website is for informational purposes only and does not constitute a legal opinion or medical advice. Contact your legal representative or medical professional for information specific to your legal or medical needs.

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