Protect Yourself from Business Income Interruptions
Small businesses often run on a very tight budgets. It doesn't take much to throw the business off and make it so it will start to fail. That's why any kind of business interruption can be deadly. If you are a small business owner, one of the smartest things you can do to protect your business is to get business interruption insurance.
What Is Business Interruption Insurance?
This kind of insurance is also called income insurance. That's because its focus is the income that you lose due to unforeseeable circumstances. It is designed to help you keep going until you get your business back on its feet and running again.
What Does Business Interruption Insurance Cover?
This insurance covers losses due to disasters. Disasters include a large range of things, such as income loss from natural disasters that will cause you to close, like hurricanes and tornadoes that do enough damage that your business can't open. Disasters can also be defined as things like fire and flooded buildings. Most business interruption insurance policies will also cover theft. Losing business equipment can either mean a significant loss of income or losing your full income. The insurance can help you get new equipment to get everything back up and running. You may be able to replace your equipment with the same models or something equivalent to what you already had, or you may be able to get upgraded equipment. It depends on your policy and what riders you may have added.
What Doesn't Business Interruption Insurance Cover?
This kind of insurance is not liability insurance or property insurance. What that means is that you have to have separate policies for that. Someone getting injured at your place of business doesn't lose you income. Being sued isn't classified as a business interruption. While your business income insurance will cover the income you lose from disasters, it won't give you the money to rebuild any physical space that your business uses. If you have a fire, you will have to talk to the insurance company that holds your property insurance and the company that holds your interruption insurance. You may be able to get both of them from the same company, which can help save you some money.
Small business owners have enough to worry about. You shouldn't have to worry about what will happen to your income if your business has to close for some disaster or theft. Talk to an business insurance agent about getting business interruption insurance.