Business Income: When Disaster Strikes

From floods to hurricanes, summertime is host to a variety of natural disasters. With the season drawing near, it is the perfect time to look into business income insurance if your business is not already covered. Considering the rising number of natural disasters, businesses should consider adding this coverage to your property policy to ensure their wellbeing in the event of a disaster or significant loss of any kind.Typical commercial property insurance covers physical damage to a business caused by a covered peril. Business income insurance endorses the commercial property policy to cover the loss of income a business suffers as result of those same covered perils. After a disaster occurs, your business can be indemnified, in full or at a specified percentage, for the profits that would have been earned during the time your business was closed and being rebuilt. This time frame is also known as the business interruption period.Carriers may differ on how they calculate the estimated loss of income, but you will generally need to provide historical income data, and an estimate of what the current period could have earned.  For example, if you owned a hotel, you could use the prior 3 years bookings, percentage of growth/reduction, and the bookings that were made for the interruption period to come up with a close estimate of loss.Since business income coverage cannot include all potential costs resulting from a disaster, it is important to be thorough in discussing terms of additional coverage with your agent in Sandy Springs. For example, if your business’s successful operations are dependent upon another’s success, you could add “contingent business” coverage to your policy to ensure your business is not negatively affected by another. One of our agents will gladly provide greater detail.At Risk & Insurance Consultants, we want to make sure your business has the protection it needs against disaster. Contact us today to make sure your business will be safe when disaster strikes. Just click here.