What is Business Interruption Coverage? | ClaimsMate

WHAT IS BUSINESS INTERRUPTION COVERAGE?

Business interruption coverage is a way for businesses to replace lost income due to unexpected events. If your business burns down, floods, or experiences another covered peril, then you might file a claim for business interruption coverage.

What Does Business Interruption Insurance Cover?

Business interruption insurance covers lost income from destroyed merchandise as well as money you would have been expected to earn.

Your insurer will check your pre-loss earnings, then use this information to decide how much you would have earned if you hadn’t experienced that loss.

LOST INCOME:

A fire, flood, or other covered peril can be devastating for a business. If your business incurs extra expenses as a result of a covered peril, then business interruption insurance should cover this loss. If you must temporarily relocate your loss because of a flood, for example, then business interruption insurance should cover the cost of this temporarily relocation.

EXTRA EXPENSES:

Business interruption insurance will not, however, cover the cost of repairing the damaged building (assuming you own the building in which your business is located). This would fall under traditional property coverage – not business interruption insurance.

IMPORTANT: