What is Business Interruption Insurance?

If you already have business insurance, you may have heard of Business Interruption insurance. Since the COVID-19 pandemic impact, we think it could be worthwhile for you to look into this type of coverage.

We at Uniamerica Insurance strive to inform and prepare our clients with all things insurance.

Business interruption insurance helps replace lost income and pay for extra expenses when a business is affected by a covered peril. Business interruption coverage (sometimes called business income coverage) is typically part of a business owners insurance policy. Read on to learn how business interruption coverage can help your business recover after a loss.

WHAT DOES BUSINESS INTERRUPTION INSURANCE COVER?

Business interruption insurance helps protect against lost income after a covered peril affects a business. This includes theft, fire, wind, falling objects or lightning.

Say a fire damages your business, For example, if a fire damages your business and it leaves the building uninhabitable with destroyed merchandise right before it was to be sold or shipped, Business interruption coverage may help reimburse you in the following way.

  1. For lost income from the destroyed merchandise (minus expenses you may have already paid, such as shipping). 
  2. For extra expenses if you must temporarily relocate your business because of the fire (for example, the cost of rent at the temporary location).

Keep in mind that, in the scenario above, the property coverage in your business owners policy would help pay to repair the damaged building (if you own it). Business interruption coverage would not pay for these types of repairs.

For more ideas, read our recent article “Los Angeles Mayor Eric Garcetti’s Plan for Reopening California Businesses.”

Let Uniamericainc.com help you with insurance today!

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