Business loss insurance – often referred to as “business interruption insurance” – is a form of insurance coverage that aids in replacing income that is lost should said business become halted due to any type of covered physical loss or damage.
Examples of situations where this type of insurance would provide coverage is a natural disaster or a fire that impacts said business. If you own a business, it is imperative that you ensure that you have this coverage in place to protect your company. Continue reading to learn more.
What Is Covered with Business Loss Insurance?
If a peril that is covered through your business loss insurance policy occurs and forces the business to shut down, the policy will cover the following:
- The money that your business would make if it was open
- The mortgage, rent, and/or lease payment associated with the business
- Any loan payments that you are responsible for paying
- The taxes associated with your business operations
- The payroll for the employees at your business
- If you have to move to a new location – either on a temporary basis or a permanent basis – the relocation costs
- Any additional expenses that you incur as a result of the peril and associated loss
- Training costs for your employees to learn new equipment or machinery that you purchase as a result of the covered loss
What Is the Restoration Period?
The restoration period of the business loss insurance policy is the length of time that the policy will pay for any type of lost income as a result of a covered peril.
In the beginning, you may have to wait for a period of up to 72 hours before the coverage will actually start. To determine the restoration period of the policy, you should review the details that are outlined in your coverages.
What Is a Coverage Limit?
Business loss insurance includes a coverage limit. This is the total amount of coverage that you pre-selected when obtaining the policy. It is the amount that you will have should a loss occur.
To determine your coverage limit, you should take the gross earnings, estimations of any future profits that you plan to have, and then your average costs.
If you fail to choose the right amount, anything above your coverage limit will be costs that you will need to pay out-of-pocket. It is always best to estimate too much and have a higher coverage limit than to estimate low and have a low coverage limit.
How Much Does Business Loss Insurance Cost?
The cost of business loss insurance will depend on the industry in which you work, the number of employees that you have at your business, and the amount of coverage that you elect to take out.
To obtain the most competitive prices, we recommend that you contact us today here at Modica Associates. Not only can we get you the lowest-priced policy, but we can guarantee that you have the highest quality policy for your needs. Call us now to learn more: 718-855-1836