Business Income Coverage

When damaged by fire or another covered peril (the cause of any loss, injury or property damage), the greatest loss to a business is often the lost wages due to the inability to continue operations. When facing the loss of revenue, one of the common types of business insurance that would be helpful is Business Income Coverage, or Business Interruption Insurance.

Several forms of business income insurance exist to protect against these losses. For example, a Business Owner’s Package (BOP) policy typically includes earnings insurance, which compensates the business for the net amount of lost wages from interrupted operations.

BOPs often include another type of coverage, Extra Expense Insurance, which facilitates funding for the business to make the necessary arrangements to continue operations with little or no interruption. This includes the costs of temporarily relocating and related advertising expenses to protect your business.

Some examples where a business could use Extra Expense Coverage include: 

• – Businesses that provide continuous services and need to remain operational 24/7
• – Essential businesses, likes banks, hospitals, and homeless shelters
• – Renting another location while the damaged premises are repaired
• – Expediting delivery of new merchandise via air freight to replace damaged contents
• – Recreating documents essential to processing orders

Some business income coverages can also cover lost wages while a business regains its market share. Other businesses may benefit from coverage of income lost due to the shutdown of a supplier or even the loss of an anchor tenant in a shopping center. 

Additional coverage is available for shutdown due to the disruption of a public utility and by order of a civil authority. Whether you’re looking for small business insurance for a brick-and-mortar shop or a home-based business, Income Coverage is going to be as important as Liability Coverage to protect your business from life’s perils.

Call our office for an analysis of your particular business income needs.