Business Interruption, Loss of Income, Business Income Insurance

As an addition to a regular business insurance policy many business owners opt to include business interruption insurance, also known as loss of income insurance or income insurance. This specialized type of policy protects the business owner from any loss of expected income that might occur as a result of a catastrophic event such as fire, flood, or windstorm.

There are some options when it comes to this type of coverage. Named Perils business interruption insurance will protect the policy holder in the event that specific perils that have been selected occur, such as fire damage or hurricane damage. All Risk Business Interruption Insurance covers every type of peril or catastrophe that can be included in a policy.

There is also the choice of Limited or Extended Indemnity.

Limited (or Earnings) Indemnity will cover the loss of income until the time that the property damage has been repaired or replaced and the business begins operating again. This type of policy costs less than the alternative but has its limitations.

Extended (or Profits) Indemnity goes one step further in that it covers the policy holder until profits return to the same level they were at before the peril occurred. It is limited by a time period that is established when initiating the policy.

There are many different areas of the business and expenses that can be compensated in the event of a peril and the process of ascertaining the full amount owed can become complicated, especially as the business involved becomes larger or more complicated. It is advisable to seek expert consultation,, like that which is offered by a public adjuster, that is not employed by the carrier of the policy if one is having difficulty understanding aspects of the policy or thinks they may be entitled to more than their insurance company has offered.