Business interruption insurance provides protection against a variety of common events including natural disasters, equipment damage, and vandalism. Just one brief business interruption can be incredibly costly for an organization, often leading to serious reputational damages or long-term closures.
Here are some major benefits of having business interruption insurance:
1. REVENUE: In the event of a disruption, business interruption (BI) insurance provides coverage for income your business would have earned if it had been operating normally.
2. RENT OR LEASE PAYMENTS: Even if your premises are unusable following a disaster or other event, many leases still require that you make payments. BI insurance allows you to continue making rent or lease payments, even while your business is not operating.
3. RELOCATION: You may even have to relocate in order to remain open and continue generating revenue. Business interruption insurance can cover the expenses of moving your business to a temporary location and may include both moving a rent costs.
4. EMPLOYEE WAGES: If you are unable to operate, it’s likely you will not be able to continue paying employees. BI insurance can help you avoid losing staff while you’re closed by ensuring that you make payroll. This is especially important since finding new employees is often more expensive than keeping them.
5. LOAN PAYMENTS: If you have an outstanding loan, you will need to continue to make payments even if your business isn’t fully operational. Business interruption insurance will ensure that you never miss a payment until you are fully operational again.