Business Income Insurance

Business Income

Business Income Insurance

How will your business provide for loss of income during a disaster?

Is your business prepared in the event of a disaster?  No matter what the disaster may be ……Fire, Tornado, Earthquake, Power Outage, Theft, Wind and so on.  How will your business survive the loss of income while its down during this  time?
Business income insurance, sometimes known as business interruption insurance, helps cover lost income when your business must shut down due to a covered peril.  For example, say your restaurant’s kitchen catches on fire. As a result, you must close down your business while you repair the damages. Your business income insurance can help pay your lost income during this time.
To fully understand your business income insurance coverage definition, you’ll need to understand these key terms:
  • Actual loss. This refers to the monetary payment you receive from insurance covering the actual loss of income to your business.
  • Business income. This includes any income that would result from regular business activity.
  • Period of restoration. This refers to the waiting period when you are repairing your business.
  • Extra expense. In some cases, you may encounter extra expenses when your business is temporarily closed for repairs and you have to move. This can also include the cost of expedited shipping on a replacement order of your business’s inventory.
  • Service interruption/contingent business interruption (CBI). This refers to the interruption in your operation or the shutting down of your business. If your business is closed, there are still operating expenses to take care of.
  • Leader property. This is an endorsement that helps cover physical loss or damage to your business. This includes damaged property that you may not have owned directly.
  • Interruption by military or civil authority. When natural disasters strike, civil authorities may order evacuations. You may have to shut down your operation as a result. Depending on your policy, your business income insurance can help cover your lost income when you’re interrupted by civil or military authorities.

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