Why Business Interruption Insurance Is Important?

why business interruption insurance is important

Why Small Business Needs Business Interruption Coverage

If something happened to your small business and you had to choose between seeing your business survive or close down, which would you pick? If you want your business continue and thrive, you should seriously consider adding business interruption coverage to your property insurance policy.

What Business Interruption Insurance Covers

After a disaster, a complete shut down will likely drive customers to the competition. With business interruption coverage, the damage can be repaired quicker while protecting income, so you can get up and running again faster.

Business interruption insurance:

  • Compensates for lost income should you have to move out of a building because of damage related to a disaster that is covered by your property insurance, such as fire.
  • Based on your financial records, covers the earnings the business would have realized had the disaster not occurred.
  • Covers operating expenses, such as electricity, that continue when a business has to stop temporarily.

How Much You Should Buy

When purchasing business interruption coverage to add to your property insurance, it’s best to make sure it will cover company expenses for a minimum of one week, but more if business size warrants it. Coverage usually doesn’t begin until 48 hours have passed since the shut-down, and many businesses can’t open again for several weeks.

What is the Cost? It Varies.

How much you’ll pay for business interruption insurance depends on what kind of business you’re insuring and where it is located. If the business is an area prone to fires, for example, it will cost more. If your business is at a higher risk of fire in general, such as a restaurant, it will cost more to insure. For a business that can easily continue off-site during repairs, coverage will cost less.

Learn More

Make sure you get the coverage that’s best for your small business. Learn more about your options and receive quotes to compare at EINSURANCE.com.


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