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Written by Adam Miller
Understanding The Basics of Business Interruption Insurance

Unforeseen shutdowns of businesses can occur at any time, whether because of fire, theft, utility outages, or windstorm damages. When a business is forced to temporarily close, it can often lead to a permanent closure because of the company's inability to cover both the building repairs and the ongoing expenses such as rent, taxes, and employee wages. What options do businesses have if they face monumental expenses and repairs in order to reopen their business? Business Interruption Insurance is the solution for businesses facing this scenario. In today's blog post, we explain the basics of Business Interruption Insurance and why businesses of all sizes and in all industries need it.

What Is Business Interruption Insurance?

Simply put, Business Interruption Insurance can cover lost revenues during a closure, as well as ongoing expenses while the business is closed for a covered Commercial Property Insurance event. However, to get Business Interruption coverage, businesses must first have a Business Owners Policy or Commercial Property policy in place, and the disruptive event must be covered under the existing Commercial Property or BOP coverage. Business Interruption coverage allows businesses to focus on their recovery and rebuilding efforts rather than face permanent closure.

What Does It Cover?

One of the biggest benefits in having Business Interruption coverage is that it covers revenue lost due to a disruptive event, which is critically important for businesses that face a lengthy period of repairs and closure. In addition to lost revenues, Business Interruption Insurance covers such ongoing expenses as employee salaries, business loans, taxes, and lease or rent payments. Business Interruption Insurance can also help cover the expense of temporarily relocating your business and employees to a different work site or office space, as well as moving charges and rent incurred with the relocation.

Why Does My Business Need It?

Businesses of all sizes and all industries need Business Interruption Insurance because of the substantial benefits it provides companies facing permanent closure because of a disruptive event. For example, a difficult expense for business owners to cover out of pocket is wages for their employees that are temporarily out of work. Business Interruption Insurance allows companies facing a temporary shutdown to pay and retain these valuable employees, which in turn can expedite their recovery process since they don't have to lose time hiring and training all new employees. In addition, Business Interruption coverage can help cover federal and state tax payments to ensure they don't fall behind and face costly penalties or interest payments.

Aegis Insurance & Financial Services is pleased to provide businesses with top quality commercial insurance coverage to meet their unique needs. Aegis offers commercial policies tailored to specific industries to ensure that all immediate and long-term needs are covered by reliable, comprehensive, and cost-effective coverage. Contact Aegis today at 713-850-7622 about our full range of Commercial Insurance policies, or go online to request a free quote today!

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