Companies can be exposed to perils that are beyond their control and that can cause not only critical damage / loss of tangible assets, but also suspension of operations and threat to the viability of the business. During the time required for recovery and resuming of the operations, the affected company may lose profits, which it would otherwise have earned. Business interruption or business income insurance offers an excellent solution in covering the company’s emergency costs and loss of income
A business interruption insurance policy provides compensation for any revenue loss and increase in fixed costs or extra expenses caused by a temporary operational/business shutdown.
It should be remembered that business interruption insurance covers only the damage caused by the events stipulated by property insurance and / or machinery and equipment breakdown insurance policies.
The amount of coverage is an important issue that needs competent assessment and understanding of specifics of the insured’s business and industry-related earnings.