Business Interruption Insurance

By Entrepreneur Staff

Business Interruption Insurance Definition:

Insurance coverage that protects a business in the event of natural disaster, fire or other extenuating circumstances that affects the ability of your company to conduct business

When a hurricane or earthquake puts your business out of commission for days--or months--your property insurance has it covered. But while property insurance pays for the cost of repairs or rebuilding, who pays for all the income you're losing while your business is unable to function?

For that, you'll need business interruption coverage. Many entrepreneurs neglect to consider this important type of coverage, which can provide enough to meet your overhead and other expenses during the time your business is out of commission. Premiums for these policies are based on your company's income. Check with your insurance agent or broker to find out more about coverage in your area.

More From Insurance

Auto Insurance

A contract for an automobile in which one party agrees to pay foranother party's financial loss resulting from a specified event(for example, a collision, theft or storm damage)

Health Insurance

A policy that will pay specified sums for medical expenses or treatments. Health policies can offer many options and vary in their approaches to coverage.

Bonding

A guarantee of performance required, either by law or consumer demand, for many businesses, most typically general contractors, temporary personnel agencies, janitorial companies and businesses with government contracts

Business Interruption Insurance

Insurance coverage that protects a business in the event of natural disaster, fire or other extenuating circumstances that affects the ability of your company to conduct business