What is Business Interruption Insurance?

Few things are more important than continuous revenue and cash flow, particularly for small to medium-sized organizations.

Just one brief business interruption can be incredibly costly for an organization, often leading to serious reputational damages or long-term closures.

That’s where business interruption insurance can help.

This coverage protects against common interruptions, including natural disasters, equipment damage, and vandalism.

Watch the video below or continue reading to learn more...

 

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What is Business Interruption Insurance?

Business interruption insurance is often included in a Business Owner's Policy (but never assume you have coverage). While rarely written as a stand-alone coverage, business interruption insurance is one of the most critical commercial insurance coverages you can purchase to create sustainability in your business.

The following are some other major benefits of business interruption insurance:

Revenue

In the event of a disruption, business interruption insurance provides coverage for income your business would have earned during a closure period if it had normally been operating.

Rent or lease payments

Even if your premises are unusable following a disaster or other event, many leases still require that you make payments.

Business interruption insurance allows you to continue making rent or lease payments, even while your business is not operating.

Relocation

In the vent that your primary location is unusable following a disaster or other event, you will likely have to relocate to remain open and continue generating revenue.

Business interruption insurance can cover the expenses of moving your business to a temporary location and may include both moving and rent costs. 

Employee wages

If you are unable to operate, likely, you will not be able to continue paying employees. Business interruption insurance can help you avoid losing staff while you’re closed by ensuring that you make payroll.

This is especially important, as finding new employees is often more expensive than keeping them.

Loan payments

If you have an outstanding loan, you will need to continue to make payments even if your business isn’t fully operational.

Business interruption insurance will ensure you never miss a payment until you are fully operational again. 

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Business Interruption Coverage Restoration Period

The restoration period of your business interruption coverage is the length of time your policy will help pay for lost income from a covered loss.
 
In most cases, there’s a 48 to 72-hour waiting period before your policy kicks in with income coverage.
 
To see when your restoration period starts and ends, contact your insurance professional and review your policy.
 

The Rub

Business interruption insurance is a critical part of the commercial insurance foundation your business needs for the risks that create revenue growth.

If the unexpected happens, our business interruption coverage can help protect your company. We’ve been helping protect small businesses for years.

The point here is there is a whole package of insurance coverages that you need to at least consider to protect the sustainability and profitability of your business, business interruption insurance being a big part.

We can help.

If your current insurance professional has never addressed issues like this with you before, I’d encourage you to reach out to us today.

I look forward to introducing you to a new way of viewing your insurance program.

Thank you,

Ryan Hanley

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