What is Business Interruption Insurance?

Interruptions are a part of life and they’re a part of business too.

Imagine your business being impacted by a major disruption such as a fire, storm, technical failure or flood, with your doors needing to be shut for days, weeks or even months… How long would it take your business to get back up and running again and how much income would you lose along the way?

Will you and your business be able to survive without any help or cover along the way? Probably not. This is where Business Interruption Insurance comes in. So, what is it and what does it cover? Let’s find out.

What is Business Interruption Insurance?

Business Interruption Insurance, also known as Consequential Loss Insurance, is business insurance that covers the turnover lost from unexpected events such as this, so you can recover and rebuild without the extra stress of income loss.

Why is Business Interruption Insurance important?

As we touched on earlier, if your business is interrupted, you won’t receive any income and if you don’t receive any income, you won’t be able to pay you rent, your staff, or your bills, let alone the bills for repairing your building or replacing stolen goods.

Business Interruption Insurance provides you and your business with the peace of mind which is so crucial in business today – it’s being able to say “It will all be okay.”

What does Business Interruption Insurance cover?

Business Interruption Insurance covers the loss of any sales you would usually have made if your business was still running as usual. 

It may also cover:

  • Ongoing operating expenses, such as rent and staff wages
  • Relocation costs
  • Training costs for operators of replacement machinery
  • Closure of your business premises
  • Damage to a supplier’s premises

What type of businesses require Business Interruption Insurance?

Any business that would not be able to operate or pay their expenses, if they had to close their doors for a period of time, should consider Business Interruption Insurance.

A recent survey by an Australian Insurance Company found that 1 in 7 businesses experienced a shortfall in income because of a business interruption in the past 12 months. The survey also found that one in four businesses would not survive if they had to close their doors for more than three months.

If you’re a business owner and this data shocked you a little, you may want to consider finding out more.

Find out if your business needs Business Interruption Insurance

Unforeseen business interruptions can be really damaging to your business, which is why it’s important to speak to an insurance broker to find out whether you may need one.

Find out more about Business Interruption Insurance here.

Grace insurance is here to find out more about you and your business and advise you on which type of insurance you may need for your business. We can help you understand your risks and provide you with an obligation free quotation on these insurances too.

Contact Grace Insurance in Landsdale, north of Perth today.