FRIDAY, AUGUST 11, 2023
Consistent and reliable operations are integral to your business’s success. Unfortunately, unexpected incidents may disrupt your company and lead to financial repercussions. Furthermore, your business may be unable to deliver promised goods and services to clients and customers, resulting in reputational harm. Given these potential consequences, implementing effective loss control measures, such as an adequate business interruption insurance policy, should be a top priority.
How Does Business Insurance Work?
Business interruption insurance, or business income insurance, is designed to offer financial protection following incidents that disrupt or delay your organization’s operations. These policies can provide your company the financial assistance needed to navigate these potentially challenging times. 
What Can Business Interruption Insurance Cover?
Business interruption insurance can respond to incidents at your company in many ways. While the details of your policy may vary, you can typically have the following expenses or losses included in your coverage:
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Revenue losses—This aspect of the policy may help your business recover the income it would have generated if not for your operations having been interrupted.
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Fixed expenses—Your business interruption insurance may render financial aid for ongoing bills, such as rent, mortgage payments, taxes and loans.
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Employee payroll—Your policy may also help ensure your company’s employees are paid even if business operations are temporarily halted.
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Temporary relocation costs—If a covered incident makes your premises uninhabitable, your insurance may help pay for moving expenses and additional costs, such as rent.
How Much Support Can Business Interruption Insurance Provide?
Business interruption insurance policies come with a restoration period, specifying the length of time during which financial assistance is provided for covered incidents. Additionally, there is typically a waiting period before the insurance coverage takes effect. Although policy details may vary, waiting periods commonly last between 48 to 72 hours, while restoration periods can extend up to 12 months. In some cases, your policy may continue to offer financial assistance even if it expires during the restoration period.
What Factors Influence Business Interruption Insurance Costs?
The cost of business interruption insurance varies depending on your organization’s unique circumstances. Your insurer may consider the following factors:
We’re Here to Help
With a history of service dating back over 100 years, the dedicated staff at J.S. Edwards & Sherlock Insurance Agency is well-equipped to help your business assess its coverage needs. Our agents will work with you to identify your business interruption insurance needs and compose optimal policies to help secure your finances and future. Visit our website or call one of our offices in Beaumont, Houston or Nederland to get started today.
This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.
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