Business Interruption Coverage: The Introduction

Business Interruption Coverage: The IntroductionIf your business has to temporarily close its doors for reconstruction, how will you make up that lost income?

Imagine this scenario: during a vicious thunderstorm, a lightning bolt strikes a tree weakening it structurally. Moments later, fierce winds blowing against the tree force it to collapse with only one thing to break its fall . . . your business! The front of the building, and most of your equipment now lays flat as a pancake under this tree with only that printer that so often jams making it out unscathed (of course). You have to close your business, rebuild, and re-purchase everything. This means trouble if this is your family’s only source of income. With business interruption coverage, you don’t have to worry about income as you’ll be reimbursed for the lost business until you’re ready to operate again (or, until the amount of time that is stated in your contract passes).

Business Interruption Coverages

This insurance policy helps protect from your lost earnings in the event you cannot operate your business after a covered loss, or if said loss interrupts the flow of your income. If you lose income as a result of this loss, you can typically recover a significant portion of these earnings.

How Much Coverage Do You Need?

Here are some questions that you should ask if you are considering this useful insurance.

  • What about after a regional disaster? If you live in a disaster-prone area, you will compete with other displaced business owners for a spot and this may take time, potentially increasing your business losses.
  • How likely is it that a covered loss will occur? For example, if you live on the Gulf Coast, hurricane frequency is one consideration.
  • How long would it take to get your business up and running after a serious event?
  • If you rent, how well protected is your building?
  • Is comparable commercial space readily available in your area, or would it take weeks to find a suitable location?
  • Are sprinkler systems up to date and functional?

For all of your business insurance needs as a Texas business owner, contact VGW Walker Insurance. As an independent insurance agency, we will work with you to ensure you have the right amount of protection for your specific needs, all at the right price to fit your budget.