Business income insurance, sometimes known as business interruption insurance, helps cover the loss of business income if you can’t operate because of a covered peril. Covered causes of loss can include things like:
For example, say your restaurant’s kitchen catches on fire. As a result, you must close your business while you repair the damaged property. This insurance can help cover your lost income and expenses during this time.
To fully understand your business income insurance coverage definition, you’ll need to understand these key terms:
Your business income coverage, also known as business interruption coverage or extra expense coverage, can cover lost income when you need to close your business suddenly. This coverage applies an extra layer of protection beyond general commercial property insurance.
Your policy can also include extended business income coverage to help protect your business from a slowdown after your business reopens.
For example, it took four months to repair your restaurant after the kitchen fire. After you reopen, you have lower sales than before the fire shut down your restaurant. Extended business income can help cover your lost income due to the slowdown after you reopen.
To better understand how business income coverage can help replace your lost income, consider these scenarios:
The payout amounts you receive on your business income coverage are based on your business’ income and expense records. As a business owner, you should store these records in a safe location. You may even want to store them off-site or in digital locations.
It’s important to note that business income insurance may not also cover all of your business’ utilities.
Most small businesses can benefit from a business income insurance policy. This coverage helps pay for lost income if your company has to shut down due to a covered loss, like a fire.
Yes, business income coverage can help pay your operating expenses, like payroll, while you’re shut down temporarily from a covered loss.
In most cases, business income coverage doesn’t have a monetary deductible. However, there is sometimes a time deductible. Some insurers may have a waiting period up to 72 hours after the covered loss occurs before coverage starts. Our business income coverage has a zero hour waiting period, so coverage begins immediately after covered property damage.
If your business has a physical location with products, services or equipment, you can benefit from this coverage.
Business owners often ask, “What’s the difference between Business Income vs. Business Interruption?” The answer is simple. Business income insurance is the same as business interruption insurance.
Read a full list of frequently asked questions for Business Income Insurance.
To learn more about business income coverage, get a quote today. We’re an experienced insurance company that you can count on. Our specialists can work with you to get you the policies you need at the right price. We can also help teach you how to reduce your risk exposure. Whether you have questions about business insurance or need help with a claim, we’ve got your back.
