For many California residents, heading to their favorite gym or fitness center for a good workout is a regular part of their lives. According to IHRSA, California is home to over 4,000 health clubs with more than 8 million people visiting them.
But when Governor Gavin Newsom’s shelter-in-place order forced gyms and other types of fitness centers to temporarily close, all of those gym regulars were forced to look for new ways to stay fit and the owners of those facilities had to figure out how their business would move forward during this difficult time.
Fitness Center Business Losses From Coronavirus
Gyms and fitness centers can take many different approaches to helping people get fit and, while some gym owners were able to explore other ways to keep business going during mandated shutdowns, those alternatives may not have worked for others. Some gyms were able to successfully transition into offering online classes, remote personal training, and virtual coaching services. But for fitness centers that depend on providing specialized spaces and equipment for members to use, like racquetball courts and rock climbing walls, live streaming classes simply isn’t an effective option.
Not only did many gyms and fitness centers lose out on membership dues and class fees during this time, they also lost revenue generated through other means, like sales of merchandise, food and beverages, and spa services.
Obstacles to Reopening Gyms After COVID-19
Even once gyms and other fitness centers are able to resume operations, it’s unlikely they will be able to operate at the same level they had been before the pandemic began. New procedures will need to be put into place to make sure spaces are thoroughly cleaned. Limitations on class sizes and the number of members allowed in at a time will likely be needed to allow for social distancing.
When gyms are able to re-open, there’s a chance they might not be able to charge the same prices they had been before closing. Many people may feel hesitant about the idea of working out in a gym anytime soon, so reduced fees may be needed to give customers an incentive to come back. If a gym or fitness center laid off their employees during the closure, they’ll also need to deal with the costs of re-hiring trainers and other staff members when they’re able to start back up again.
Business Interruption Insurance Claims for Fitness Centers
Knowing that a wide range of reasons could force gyms to temporarily close their doors, fitness center owners commonly plan ahead by purchasing business insurance policies that would help them out on those occasions. Business interruption insurance is intended to cover monetary losses stemming from temporary closures, most commonly because of reasons like property damage caused by a fire or severe weather. Some business owners may also have insurance policies that include civil authority coverage, which applies to temporary closures resulting from a government order.
But right when business owners urgently need these insurance benefits to help cover expenses like employee payroll and rent payments, insurance carriers have taken the approach of broadly denying claims for business interruption benefits. Often, they try to argue that these types of policies were never meant to apply to closures caused by pandemics or that coronavirus does not qualify as a type of physical property damage. They’re trying to use the same arguments for civil authority insurance claims. In some cases, insurers have gone as far as to discourage business owners from even bothering to make a claim for their losses.
Help for Gym Owners
The team at The Wallace Firm has strong ties to the Los Angeles area and we care about helping business owners get back on their feet. We are now working with California business owners to help them with their business interruption insurance claims, whether they’ve made a claim and been denied or are still in the process of getting ready to make a claim.
Trying to keep a business going during the coronavirus pandemic is stressful enough. The last thing you should have to worry about is having a difficult time dealing with your insurance provider. Our lawyers are used to taking on insurance companies and holding them accountable. We’re handling these cases on a contingency basis, so you won’t be charged anything unless we help you get the benefits you deserve. Contact us today to see how we can help.