Business Interruption Cover
Business interruption insurance can provide cover for loss of income, or the additional costs incurred following an insured incident which affects the activities of the business, such as a fire or flood.
For example, should a fire render the business premises unusable, it could take many months for the business to be reinstated.
Business interruption cover can be included within your existing property insurance policy and can provide compensation for
- Loss of income incurred whilst the premises and its contents are being reinstated
- Loss of gross profits
- Operating expenses that must continue to be paid regardless of the fact that the premises are not open
- Increased costs of working such as alternative premises hire
Consideration will need to be given Indemnity period, this being the length of time cover will be provided.
It is often underestimated how long it will take to reinstate the business and reach a pre loss financial position. Cover is usually provided for 12, 24, or 36 months.
Experience shows that many businesses do not survive a major loss because they do not choose a long enough Indemnity Period and/or do not correctly calculate their business interruption sum insured so it is important that advice is sought from your insurance broker.
This is a very brief overview of business interruption insurance, our teams will be happy to offer more specific and detailed advice.