Question 1

What triggers business interruption coverage?

Accepted Answer

Business interruption coverage commonly responds when a covered cause of physical loss or damage affects insured property and results in a qualifying interruption, subject to the policy form. Standard property-linked BI typically requires direct physical loss or damage — not merely lost revenue, a supplier delay, or a government closure without an insured peril affecting your property. Extensions for contingent properties, utilities, or civil authority may have different triggers — confirm each with your broker.

Question 2

Is business interruption automatically included with property insurance?

Accepted Answer

Not always. BI is often an endorsement or component of a commercial property program, but it must be explicitly included with chosen limits, waiting periods, and indemnity periods. Some bare property quotes omit BI or include minimal limits. Review declarations and endorsements rather than assuming income coverage is bundled.

Question 3

What is an indemnity or restoration period?

Accepted Answer

The indemnity period — sometimes called the period of restoration — is the maximum time BI payments continue after a covered loss, measured from the date of loss or from when the waiting period ends, depending on form. It should reflect how long rebuild, equipment replacement, and return to normal revenue would realistically take. Once the period expires, payments stop even if you have not fully recovered.

Question 4

What is contingent business interruption?

Accepted Answer

Contingent business interruption — where purchased — may address income loss when a named dependent property such as a key supplier or major customer suffers covered direct physical loss that disrupts your operations. It does not cover every supply-chain interruption: the dependent location must be scheduled, suffer covered physical damage, and the policy must define the resulting interruption. Financial failure, strikes, or utility outages without physical damage at the dependent property are typically excluded unless a separate extension applies.

Question 5

What information is needed to quote business interruption?

Accepted Answer

Carriers commonly review operations, property values, projected gross earnings or net income, continuing expense breakdowns, payroll, number of locations, critical suppliers or customers, prior losses, and desired waiting and indemnity periods — though questions vary by insurer. Financial statements and realistic downtime scenarios help align limits with exposure. BI is usually quoted alongside commercial property rather than standalone.

Business Interruption Insurance

What's covered

Revenue doesn't pause when the doors close

Practical considerations

Why a broker?

Your operation

Multiple insurance markets

Premium broker

Right-fit coverage

Business interruption FAQ

Could your business survive a long shutdown?

Business Interruption Insurance

What's covered

Revenue doesn't pause when the doors close

Practical considerations

The trigger — covered physical loss or damageBusiness interruption coverage commonly responds when a covered cause of physical loss or damage affects insured property and results in a…

Waiting period (time deductible)Many policies include a waiting period — often 24 to 72 hours on many forms, though periods vary — before BI payments begin.

Indemnity or restoration periodPolicies limit how long BI payments continue — commonly 12, 18, or 24 months on many programs, though options vary.

Limits and coinsurance on business income valuesBI limits should reflect projected earnings and continuing expenses during the maximum foreseeable shutdown.

Continuing expenses and ordinary payrollPolicies distinguish continuing fixed costs from expenses that stop when you close.

Extra expense versus lost incomeExtra expense pays additional costs to minimize the BI loss or speed resumption; lost income pays the earnings gap.

Dependent properties and contingent BIWhen your business depends on a few key suppliers, customers, or a leader property, contingent business interruption — where purchased —…

Accounting records and documentationClaims adjusters rely on profit-and-loss statements, tax returns, payroll records, and pre-loss revenue trends to calculate loss.