Business interruption insurance is intended to cover the revenue lost when an event beyond your control forces you to temporarily close your business. This extra protection layer goes beyond regular business insurance. For example, if a fire in your office forces you to temporarily close, property insurance will cover the damage from the fire, but not the loss of income.
- Income that your business would have earned if it normally works during the time the business is closed.
- Rent or rent payments during the time when the premises were unusable.
- Transfer costs associated with moving to a temporary location, which may include operating expenses and rent.
- Employee salaries to help you make payroll when your business cannot work.
- Corporate taxes
- Loan payments  Losses caused by damages that prevent access to a building. Also known as burglary or entry, this coverage applies when a government implements a curfew or other restriction that keeps people away from your business.
Exclusive business interruption insurance
Like all other insurance policies, business interruptions have insurance restrictions and exclusions. It does not cover all events that may cause your company to close the doors. If an event like a flood that is not covered by your property insurance keeps your business from working, you will not be subject to business interruption insurance unless you have a flood insurance attribution to your property insurance.
In general, business interruption insurance will not cover:
- Undocumented Income : It is important to have several months of documented income, especially if your business is growing so that you can account for the revenue for whatever you want that the policy should replace you. You have to prove that your business suffered financial damage due to the interruption. Find out what evidence your policy requires and carefully document your questions.
- Utilities : Because tools are normally shut down when a business location cannot be used, they usually do not fall into business interruptions.
- Partial closure loss : Business interruption coverage does not come into effect if access to your building is limited but not completely eliminated.
- Losses from closures caused by non-covered damages : You cannot receive income protection for flood damage or earthquake damage not covered by your property insurance or for closing your business voluntarily.
- Closures caused by downward power lines : Most closures caused by downward power lines from a storm or accident are not covered by a business interruption policy. Power outages are common and power is usually restored quickly. Business interruption policies usually require a company to be shut down for at least 72 hours before benefits come into effect.
Although there are exceptions, such as with any insurance policy, business interruption insurance can provide the extra level of protection your business needs. Talk to an experienced agent at McElhinny Insurance Agency in Pittsburgh, Pennsylvania about the best available rates to add business interruption insurance to your business and commercial insurance package.