What is business income coverage?
A. BUSINESS INCOME INSURANCE (also known as BUSINESS INTERRUPTION INSURANCE) Commercial coverage that reimburses a business owner for lost profits and continuing fixed expenses during the time that a business must stay closed while the premises are being restored because of physical damage from a covered peril, such as a fire.
Business Income coverage is an extremely important coverage you should consider as part of your overall property insurance protection. This coverage is designed to protect your loss of revenue and your ability to pay your ongoing expenses in the event of a major loss such as a fire or tornado resulting in your business being forced to close its doors for an extended period of time. It is important to ask the question, “How much money would I need each month to continue my normal operating expenses and how much net income would I lose from new sales and suspended memberships”. Keep in mind that if you had a serious loss, it would take at least a month to clean up the mess, a month to pull your permits and line up contractors and then several months of rebuilding. It could conceivably take up to six months to get back in business. Calculating the proper amount of coverage can be very difficult. We recommend that you carry enough coverage to replace for to six months of your ongoing expen
Business income insurance may reimburse you for ongoing expenses such as utility bills while your business is closed due to a property loss. This coverage also provides your loss of net income that you would have earned if a covered cause of property loss had not occurred. This coverage may also cover losses due to down time or extra expenses needed to restore operations, such as additional property rental expense.
Related Questions
- Do commercial policies include coverage for loss of business income, debris removal, power failure, frozen water pipes, water damage from frozen water pipes and collapse due to weight of ice and snow?
- How does business income insurance differ from other types of coverage?
- How Does Business Income Coverage work?
