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Fire & Water - Cleanup & Restoration

What Does Business Interruption Insurance Cover?

12/29/2020 (Permalink)

Financial concept meaning Business Interruption Insurance with sign on the piece of paper. Business interruption insurance will cover income lost after a fire or other disaster

What Does Business Interruption Insurance Cover?

If your Weho, CA, business experiences fire damage, it is likely that the business will lose at least some revenue. Fortunately, interruption insurance can help smooth things over until your business reopens at full capacity.


Coverage
Business interruption resulting from a fire is likely to be expensive. Fortunately, income insurance will cover your lost income. Additionally, the insurance may help pay for things such as

  • Temporary relocation expenses
  • Payroll
  • Monthly bills, such as loan payments


Understanding what your income insurance covers as well as what your other business insurance policies cover can help you form a clear picture of what sort of out-of-pocket costs you may incur after a loss. Speak with your insurance agent to ensure you have appropriate coverage for your unique business situation. Make sure you know how long your policy’s restoration period is—how long the insurance company will cover lost income and other expenses. Determine if you and your employees can restore the property that quickly or if you need the help of a professional restoration service.


Considerations
Every business is unique, and it is important to fully understand your company’s unique structure and situation when you purchase interruption insurance. When purchasing income insurance, be sure to speak with your agent about the cost of your monthly operating expenses, how easily the business could be relocated, who would be responsible for the fire restoration process and how well-protected from fire and other disasters the business is. Your agent should help you find a policy with enough coverage so that a fire or other loss will not put you out of business.
While commercial property insurance will cover the business’s physical assets destroyed in a fire and liability insurance will cover lawsuits, only business interruption insurance will cover income lost after a fire or other disaster. Many times, all of these coverages are included in a single business owner’s policy, but it is important to check with your agent and fully read your policy to be sure you have the coverage you need.

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