As a business owner, there are things that you plan for in the normal course of business operations. However, a disaster is not something that you ever truly expect. These unexpected events can leave your business devastated if you are not financially prepared. Part of disaster preparation includes making sure your business assets are properly insured against disasters through insurance for business owners called business interruption insurance.
What Business Interruption Insurance Covers
Business interruption insurance differs from property insurance. While property insurance may cover the physical damage to your business caused by a disaster, it does little to cover other expenses such as lost profits, expenses for business operations, moving to a temporary location and other disaster-related expenses. It is sold as a part of a business owner’s policy (BOP) or can be added to a property insurance policy by an endorsement (policy rider).
Business interruption insurance can be customized to fit your individual company’s needs. There are a few limitations you should be aware of before deciding to add business interruption insurance to your policy. There may be a waiting period of several days after a covered event before coverage begins and that coverage may not be retroactive to the date of the event. There may also be a time limitation on coverage; some policies limit the coverage to 12 months after the event.
It’s too late to purchase insurance after a disaster has devastated your business. If you think you may need to add business interruption insurance to your policy, be sure to contact us to discuss all of your business insurance options. We represent over 80 insurance companies, which allows us to research various possibilities before pairing you with the coverage the truly meets your requirements.