Business Interruption Insurance is coverage that replaces lost income due to a disaster that is limited to these stated in the policy. Not all business interruption policies are the same. The information set forth below is general information. Prospective clients should discuss their needs with an independent insurance broker and read the policy offered. These policies are normally add-ons as apposed to separate policies. All business owners should obtain coverage if they are serious about surviving common disasters.

Types of coverages that are generally available include:

• Business Income Coverage: This replaces lost income and pays for ongoing business expenses if the business is forced to close due to a covered loss. Generally, rent, payroll, and utilities are included for a defined period of time.
• Additional Expense Coverage: This usually covers the extra expenses the insured may incur to minimize or avoid a shutdown of the business such as temporary office space, paying non-exempt staff overtime, temporary relocation, and transportation costs.
• Contingent Interruption Coverage: This provides coverage for losses by the disruption in the operation of a supplier or business partner the insured relies upon.

Things to Consider: (1) Lost profits are based upon prior performance subject to a cap defined in the policy, (2) The coverage of wages is critically important to a business if it does not want to lose employees while shutting down and while shut down. (3) Businesses are still required to pay taxes even during a disaster unless waived by the government, and (4) Losses due to pandemics are sometimes excluded. Contact us to protect your business before you are affected by a disaster.