How Business Interruption Insurance Can Safeguard Your Operations
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Contents
Introduction
Your business is your livelihood. It’s the lifeblood of your financial well-being, and its operations are key to your survival. Here’s a quick quiz: What happens if disaster strikes and you lose access to critical parts of your business? If you don’t have the right insurance coverage in place, it’s not hard to imagine some pretty dire consequences for your business’ future. That’s why it’s vital for every entrepreneur to have at least some type of business interruption (BI) insurance on hand—and ideally more than one type of policy so that they can choose a plan that fits their particular needs. Read on as we explain what BI policies are available and how they can help safeguard against unforeseen disasters like fires or floods that cut off access to important records and assets
What Is Business Interruption Insurance?
Business interruption insurance covers the costs of lost revenue and other expenses if your business is shut down due to a covered event. The policy can also cover losses due to fire, flood or other natural disasters.
Business Interruption Insurance – What Is It?
Business interruption insurance protects your company against the loss of income due to property damage or physical injury sustained by employees during their workday. In order for this type of coverage to apply, there must be an interruption in the normal course or operation of your business activities caused by either: 1) An accident that occurs while employees are working; 2) A strike against another employer; 3) An act of God such as lightning strikes etcetera (subjects covered under standard property policies).
Why You Need It
Business interruption insurance can be a lifesaver if you’re hit by an unforeseen disaster. This coverage will help you recover from losses caused by covered events such as fire, flood or other natural disasters. It provides coverage for lost income, extra expenses and lost profits.
If you have a retail store that depends on daily foot traffic to stay afloat, your business interruption insurance may be able to pay out some of those missed sales in the event of an emergency closure that lasts longer than 24 hours.
How to Shop Around for the Right Policy
When you’re shopping around for a business interruption insurance policy, it’s important to look for one that best fits your needs. The best way to do this is by asking yourself a few key questions:
- What kind of coverage do I need?
- How much coverage should I get?
- What are some common causes of business interruption losses and how much will they cost me if they happen?
The Fine Print
Let’s take a closer look at what business interruption insurance covers and what it doesn’t.
- What is covered?
- – The cost of replacing inventory, machinery, tools and other materials that were damaged or destroyed by fire or other insured peril. For example: If your factory burns down and it takes six months to rebuild it, you’ll be paid for that time period until your business can get back up and running again.
- What isn’t covered?
- – Property loss caused by theft or vandalism; earthquake damage unless specifically stated otherwise in the policy; personal injury resulting from an insured peril such as fire (except if caused by smoke inhalation); war perils; flood damage occurring outside of a building or structure (if there’s enough water surrounding your building); losses incurred while transporting goods across water via ferry boats/ships/barges/etc.; losses sustained while being stored outdoors in containers; losses resulting from nuclear radiation contamination resulting from nuclear explosion-related activities at facilities located within 10 miles (16 km) of ground zero.* How do I file my claim?
You’ll need to contact your broker right away so they can start investigating what happened before filing paperwork with their insurer.* How do I renew my policy? If you purchased coverage through us directly online then simply log into [log in details here] where we will walk through the steps needed to renew coverage without having any gaps between policies!
Business interruption insurance can help you recover from unforeseen disasters.
Business interruption insurance is a form of property insurance that covers loss of income due to a covered event. It’s not the same as business interruption coverage, which is typically offered as a rider to a business property policy.
Business interruption coverage helps you recover from unforeseen disasters such as fire or weather damage that may prevent your employees from working for an extended period of time (e.g., six months or more). This can include things like:
- The cost of hiring temporary workers while repairs are being made
- Payment for lost profits during this period
Conclusion
Business interruption insurance is a crucial part of any business owner’s insurance portfolio. It can protect you from unexpected events that could put your operations on hold, such as a fire or flood. The right policy can also help cover costs related to lost revenue and inventory while repairs are being made. In addition, business interruption insurance can provide coverage for workers compensation claims due to injuries sustained by employees during an emergency situation at work site or job site.
