Few things are more important than continuous revenue and cash flow, particularly for small to medium-sized businesses than business continuation insurance. In fact, even one small business interruption can be incredibly costly for an organization, often leading to serious damage to a business reputation, or possibly long-term or permanent closures.
That’s where business interruption insurance can help. This type of insurance coverage provides protection against many common interruptions like natural disasters, equipment damage and vandalism.
In addition to these common interruptions, a business can benefit from interruption coverage in the following ways:
Revenue
In the event of a disruption, your policy provides for income your business would have earned during a closure period if it had been operating normally.
Rent or Lease Payments
Even if your premises are unusable following a disaster or other event, many leases still require that you make payments. Business interruption insurance can cover the expenses of moving your business to a temporary location and may include both moving and rent costs.
Relocation
In the event that your primary location is unusable following a disaster or other event, you will likely 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 and rent costs.
Employee wages
If you are unable to operate, it is likely that you will not be able to continue paying employees. Business interruption insurance can help you avoid losing staff while you’re closed by helping you can make payroll. This is especially important, as finding new employees is often more expensive than keeping them.
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 you never miss a payment until you are fully operational again.
Business interruption insurance is designed to give businesses access to the assets they need when they need it most. However, these policies can be complex, and it is important to work with your insurance broker closely when seeking coverage. To learn more, contact us today.