Many customers understand that if a loss occurs insurance carriers pay the scheduled amount on the policy to make a customer whole. If a building is worth $500,000 and burns down, the client will get the amount shown taking into consideration deductibles, co-insurance (s), etc. Reviewing your policy limits and making sure they are adequate with your risk manager is imperative. One coverage that often gets overlooked is Business Interruption Insurance or BI. This covers the company for loss of income should a loss occur. For example; if the building mentioned above does burn down, how will you get reimbursed for your loss of income? What if it takes 6 months or more to put your company back together? Does your policy have adequate limits to cover that financial loss?
One way to determine if your limits are adequate is to fill out a Business Income Worksheet. These documents are provided by each individual insurance carrier, and assess a businesses’ income over a 12 month period. After completing a BI worksheet you will have the correct limits that are unique to your business. Having this coverage in place will enable your company to survive a substantial loss, and give you the piece of mind to run your business.
