How Do You Get Business Interruption Insurance?
Business interruption insurance is coverage for lost profits or earnings during a forced closure on your business
. Some expenses of the business may also be covered in this policy. The best part of the policy is the peace of mind it brings to the business owners who without it could risk the total loss of their business.
Property insurance takes care of repairs needed to the building and the replacement of damaged equipment but lost income or profits and any expenses will be left to the business owner to handle. The responsibility of having to maintain the business financial requirements with no profit from the business can weigh heavy on most business owners. The majority of business owners will fold and the business will fail.
Business interruption insurance is considered an extension of your business owners package or property insurance policy and cannot be purchased by itself. Your insurance agent should be able to show you all the available plans for your business protection.
The policy you choose can be customized for your needs offering many different plan options. You can find extra coverage for longer coverage times as well more coverage amounts. More coverage time options should be considered due to the many reasons delay on repairs can be caused by. You should also be aware that the policy may not be in effect right away, generally 48 hours are needed before the policy starts.
As with any insurance policy the business interruption insurance will be priced according to risk factor as well as options you choose. The location of your business as well as what type of business it is and the ease of being able to be relocated during a forced closing is considered in the total overall cost of the policy.
Your rates will be less expensive if your business can be functional in a temporary location while repairs are being made as this greatly reduces the responsibility of lost earnings or profits coverage amounts.
The lost earnings or profits as well as many business expenses that are incurred while the business is closed are covered with business interruption insurance. The insurance company will look at your recent company financial records to accurately determine the expected losses and decide the amount that needs to be paid out to you. Your financial records for your business should always be maintained accurately and be kept up to date, not just for insurance purposes.
Any business expenses considered to be continuing will be covered by the policy, electricity or water could be a covered expense if it is necessary for the repair of the building. If you are collecting lost earnings and or profits you should not expect that the coverage will pay for the lease payment for the building. You can expect that the policy will cover the relocation costs so that lost profit payments can be stopped.
Check out many different insurance policies for the best coverage and the best price on premiums. Your current agent may not have the best overall package so it is best to shop around before committing to a policy.
by: Susan Reynolds..
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