Why You Need Business Interruption Coverage

5/11/2022 (Permalink)

Why Is Business Interruption Insurance Necessary?

Flames, smoke and soot can wreak havoc on a building. If your commercial property in Delray Beach, FL, is damaged in a fire, your company's income may take a hit. After all, it's hard to do business if you don't have a place to operate. Interruption insurance helps you by compensating for the income lost as the result of a covered peril.

Income Loss Covered by Interruption Insurance

The main thing business interruption coverage ensures is that your company can continue to run even while fire damage remediation experts repair your building. It allows you to keep up with your monthly expenses:

• Payroll
  
• Loan payments
  
• Utilities
  
• Inventory
  
  

While interruption insurance policies do typically have a coverage limit, they may continue to pay for a little while after you move back into the building when the restoration is complete. This usually occurs when your business is forced to go on hiatus during repairs, as it allows for you to get it up and running again.

Extra Expenses Paid by Business Interruption Policy

Sometimes, there are additional expenses that come up when your building has significant smoke and soot damage. For example, if you have to relocate your whole operation while the fire restoration process is underway, you need money to pay for the temporary space. Keeping customers happy may also require a change in your shipping costs or an answering service to take messages while your staff is away from your building.

Depending on how many facets of your business you need to move or adapt, the expenses that you incur after a fire can be daunting. With an adequate interruption insurance policy in place, though, you should still be able to cover your basic expenses to stay afloat. Even a temporary relocation shouldn't affect your bottom line in the long run.