Pandemics aside, in the vast and growing realm of existential business threats—including cyberattacks, looting and power outages—business-interruption insurance is a vital risk-management tool for even the smallest business. It sometimes is the difference between staying afloat and drowning. Carriers, their agents and their brokers should do more to encourage widespread adoption.
Unfortunately, there is a generally poor understanding of what the insurance does. Serving as an extension to a conventional commercial property policy, it insures against the loss of revenue when a covered peril forces a business to cease operating for a period of time. It enables the business to pay its continuing—usually fixed—expenses including payroll and mortgage. It also helps recover the profit that reasonably could have been expected if the business had continued operating. Furthermore, it covers related extra expenses, such as for temporary relocation and expedited shipment of critical equipment, and it can indemnify for abnormal items, like the need for a generator.
What if your enterprise is dependent on another business for a product or service that cannot be easily obtained from…
