Expert Business Insurance Agent Advice: Understanding Your Coverage

As a business owner, you might find a sense of relief knowing that your business’s future is secure even in the wake of disaster. While there are many types of insurance for businesses, most entrepreneurs tend to overlook one type that can potentially save you a load of heartache in times of unforeseen circumstances: business interruption insurance. Having business interruption insurance means lost income will be covered if ever events such as fire, storms or hurricanes interrupt your business. As with all types of insurance, not everything is black and white, so you will need the help of an experienced business insurance agent to understand coverage.

Business Interruption Insurance Basics

Business interruption insurance is not stand-alone; it must be added to your insurance policy. To get interruption insurance, you must first produce a record of your current income. Be sure to cover a time period of at least several months to show profit increase, otherwise an insurer might limit your coverage amount. After that, you must indicate the types of interruptions you want to cover. Usually, a standard insurance policy already covers damage to equipment, stores and your inventory but you might want to add something specific like flood coverage.

Period of Restoration

The term period of restoration is defined as the amount of time between the occurrence of the loss and the time when the loss should have been fixed. It comes into effect once the loss has occurs. During this time, the insurer is required to pay compensation so you can rebuild so long as the loss happens during the policy period indicated in the insurance papers. Repairs must be done as quickly as possible and within the standard period of restoration.

Coverage Limitations

Not every disaster cost can be covered by your business interruption insurance. For example: your business is indirectly affected by a disaster and did not result in any sort of physical loss. Your insurer will not be required to pay you anything even if it causes a drop in your profitability.

Getting insurance for your business is the best way to protect your livelihood from all sorts of damage and losses. Put your business in safe hands by contacting a reliable business insurance broker from companies like Allied Insurance Managers, Inc.

(Source: Business Interruption Insurance: What It Will — and Won’t – Cover, www.Entrepreneur.com)