This is an essential introduction to business interruption insurance. In this post, we’ll discuss what a business interruption insurance policy commonly covers, and what it does not cover. We’ll also explore how you can ensure you have adequate cover to get your business back up and running should disaster ever strike.
As trusted and experienced insurance brokers, we can help you get a business insurance policy that truly meets your needs.
We have a team of experts on hand who can advise on your insurance needs. They can also help you to understand the risks that you may face as a business. Contact us on 020 8290 9080 or email business@anthonyjones.com.
What is Business Interruption Insurance?
Business interruption insurance can cover you for any loss of income you might experience if you’re unable to trade due to an unexpected event, such as a fire.
A business interruption insurance policy is designed to put your business back in the position it was in before the event happened. With adequate business interruption insurance, you should be able to continue trading as if the event didn’t happen.
What Does Business Interruption Insurance Cover?
Most business interruption insurance policies will cover the following:
- Profit reimbursement – The amount of reimbursement you receive will often be based on your business’s prior performance. As we’ll explain in more detail below, it’s important to give your insurer as accurate a profit forecast as possible.
- Ongoing costs – Your business’s fixed costs, such as operating expenses, stock, employee wages, taxes etc.
- Temporary location costs – If you need to relocate to temporary premises while your main premises are repaired or renovated, a business interruption insurance policy can cover the costs of relocating to, and operating from, this new location.
- Replacement equipment – A business interruption insurance policy may cover you for replacing equipment and technology, along with any associated training expenses.
What Does Business Interruption Insurance Not Cover?
Most business interruption insurance policies will only cover you for specific events, and some will list exceptions. For example, some insurers will require you to have a separate policy for flood damages.
It’s also unlikely that your business interruption insurance policy will cover you for closures and lost profits as a result of pandemics and viruses.
Though business interruption insurance policies will provide some cover for fixed costs, there may be some exceptions here, too. For example, your policy may not cover you for ongoing utility costs.
How To Ensure You Have Adequate Business Interruption Insurance
According to the Chartered Institute of Loss Adjusters, 40% of businesses with business interruption policies are underinsured. This means that if they ever face an unexpected event, their policy will not stretch to cover all of their expenses.
As trusted and experienced insurance brokers, we can help you get a business insurance policy that truly meets your needs. You can also find out more about our business interruption insurance policies.
We have a team of experts on hand who can advise on your insurance needs. They can also help you to understand the risks that you may face as a business. Contact us on 020 8290 9080 or email business@anthonyjones.com.
