What You Need To Know About Business Interruption Insurance

9/28/2019 (Permalink)

Commercial water damage in Wilshire Heights, TX

If a major crisis occurs, such as flooding, it may result in you having to shut down your business in Wilshire Heights, TX, for an extended period of time while a cleanup and restoration company makes necessary repairs. While some businesses may be forced to close their doors permanently when faced with this situation, business interruption insurance can help cover the costs during this time period and allow you to reopen as soon as possible.

What Does Business Interruption Insurance Cover

Business interruption insurance typically only covers damage caused by natural disasters, so some issues such as a broken pipe are not be covered. However, this usually only includes natural disasters that are already covered by your policy. For instance, flooding is not covered unless you have flood insurance added to your policy. Additionally, a partial closure is most often not covered.

After submitting a claim and providing sufficient proof, there are several costs your business income insurance can help cover:

• Lost revenue
  
• Rent or lease payment
  
• Employee wages
  
• Business taxes
  
• Relocation costs
  
• Loan payments
  
• Loss of ingress or egress
  
• Operating expenses and other fixed costs
  
  
  

How Much Coverage Do You Need?

Business interruption insurance can be added to your business’s property policy or may come as part of a package. When first buying the policy, you need to determine how much coverage you need if large water damage or another issue ever takes you by surprise. If you set your coverage limit too low, you may need to cover some costs out of pocket. It is important to consider how likely it is your business can be affected by a natural disaster, estimate how much time you might need to recuperate, and consider the availability of other commercial spaces near your building.

Having to close your business due to flooding or other natural disasters is certainly a stressful experience for any owner. Adding a business insurance policy to your current property policy may be your only hope for quickly recovering from the damage.