Business Income
Companies often worry about protecting their physical assets but overlook protecting their cash flow. Suppose a fire destroyed your business premises tomorrow. How long would it take to get up and running again? In the meantime, how would you pay creditors, and meet your payroll? A wide variety of specialized coverages are available such as Business Interruption, Extra Expense, Rental Income, etc.
Think about the following:
How long could your business survive if a fire destroyed your building and stock?
What if you had to move to new premises to continue your operations while your building was being repaired?
Would your customers go elsewhere?
What if a key supplier cannot fill your order for stock and you suffer a loss of business as a result?
What if there is an evacuation of your area ordered by the civil authorities after a toxic spill and you cannot gain access to your premises?
What if your tenants were forced to go elsewhere, and you had no rental income?
"Business Interruption Insurance" is a way to insure your livelihood. It can be customized to fit the type of business you operate. There are a number of ways to insure your business revenue, ranging from coverage for loss of income to loss of profits. Coverage can also be provided for those extra expenses that you might incur after a loss in order to keep your business operating, such as the cost of renting temporary premises, installing telephone lines and leasing replacement equipment while your premises are undergoing restoration.
Here are the types of Business Interruption coverages available:
Gross Earnings Insurance provides coverages between the time a loss occurs and when your doors re-open for business.
Profits Insurance protects you, not only until you re-open for business, but for a specified period after that, allowing you the opportunity to regain the same income level you had prior to your loss to allow you to continue operation.
Extra Expense Insurance is designed to cover extra expenses incurred after a loss to allow your business to continue in operation.
Contingent Business Interruption covers instances when one of the businesses you deal with suffers a loss that will affect your business activity. For example, one of your suppliers has a fire and can’t supply your material; or perhaps one of your customers has suffered a loss and is not in a position to buy your goods or services.
Rent or Rental Value allows you, as a property owner, to cover the loss of your rental income caused by a peril that is insured.
