Hundreds of flights have been cancelled, major sporting events called off.

Business has dried up entirely for some unfortunate firms.

The economic damage from the coronavirus outbreak has already been significant.

And it’s likely to get worse.

There’s speculation the Tokyo Olympics this summer might need to be postponed – a festival on which the Japanese government has already spent some $25bn (£19bn).

But that’s why businesses and individuals take out insurance isn’t it? To cover themselves for when unexpected and hugely damaging shocks like disease outbreaks hit?

The UK government this week, under pressure from industry lobby groups, designated Covid-19 a “notifiable disease”, in order to make it easier for affected companies to claim insurance.

So can we expect an avalanche of claims and big losses for insurance companies as a result of this outbreak?

Or are companies in for disappointment if they expect to be compensated for the economic damage wreaked by Covid-19?

What insurance is actually available against disease?

It’s worth drawing a distinction between two broad categories of business insurance, say experts.

First, there’s event cancellation insurance, which is a type generally offered by sophisticated insurance markets like Lloyd’s of London or major insurance conglomerates.

Torsten Jeworrek of the German insurer Munich Re told Reuters last month that his firm had provided cancellation insurance for the Tokyo games “in the hundreds of millions of euros”.

Second, there’s the more general cover for “business interruption” offered to companies by smaller insurance firms.

But if a firm is covered it’s covered, isn’t it?

Not necessarily. It all depends on the wording of the individual insurance contract.

But it’s important to bear a broad principle in mind, namely that there’s a difference from the perspective of the insurance company between “definable” and “undefinable” risk.

And insurance firms are unlikely to have written an insurance policy that covers a firm from the impact of an undefinable risk.

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So in the context of, say, a flood, if a business’s premises or equipment are damaged directly by that event, the business that had taken out flood insurance would probably be able to claim for the repair of the premises or replacement of the equipment, which has a certain calculable value.

But if the flood in the local meant that customers were unable to reach the business – so the economic impact was indirect and impossible to define – it’s much less likely that the company would be able to claim for lost revenues.

So how does that distinction apply to coronavirus?

Some firms might be hit directly by coronavirus impacts – for example if their premises are shut down by the authorities to contain the virus.

But many more will be hit only indirectly. Think of a hotel that sees its bookings slump because people change their travel plans. Or a company that suffers because it’s staff don’t turn up to work because of illness.

In any case, industry experts caution that “notifiable disease” clauses (the classification the UK government updated this week) are not standard in insurance contracts.

“Standard business insurance policies are designed and priced to cover standard risks, not those that are very unlikely, such as the effects of Covid-19,” said a spokesperson for the Association of British Insurers.

So what’s the bottom line: are insurers going to be hit hard or not?

Crawford Forensic Accounting Services produced a report last month on the likely impact of coronavirus on the insurance sector.

It concluded that “successful claims under business interruption coverage for infection are not common”.

Crawford director Frederique Hardy also told The Independent that event cancellation insurance contracts tend to be very bespoke, making it difficult to generalise about the ability of event organisers to make claim.

Yet the general view of the industry – at the moment – is that coronavirus is unlikely to result in an explosion of costly payouts.

“We don’t think it will open the flood gates [to claims],” said Ms Hardy.

If that’s correct it points to a lot of disappointed firms.