Does My Business Need Business Interruption Insurance

5e21b9645d1ae73a5ed41e1d50c1260cThe one certain thing in business – nothing is certain. Hundreds of thousands of businesses a year are affected by things like construction accidents, utility service interruptions, fires, floods, terrorism, and major storms. Responsible businesses protect themselves from a physical loss with property insurance. Adding Business Interruption Insurance to your existing policy can cover the profits that are lost while your business is closed and rebuilding.

Could you live without the income from your business if it was shut down by a fire, prolonged power outage, flood or other disaster? Many businesses owners can’t.  Over 600 thousand businesses a year close their doors. One of the main reasons they fail is the lack of adequate cash reserves. They operate month to month and can’t tolerate lost revenue.

According to the Small Business Administration, 43 percent of businesses that suffer a disaster never reopen. If there is a disaster, does your business have the resources to survive?

Standard insurance policies only cover your property and inventory. Your time and profits are lost forever.  Business Interruption Insurance is designed to make your business whole. It will pay you for your lost profits and help you going while your business is unable to operate.

Consider the following case study:

A successful martial arts studio on Long Island recently suffered a catastrophic fire (http://portjefferson.patch.com/groups/police-and-fire/p/fire-engulfs-mt-sinai-karate-center-seven-businesses-affected_12c03865). The owner had rented a new, larger space and upgraded his equipment. The building was unoccupied and there were no injuries, but the contents and interior were a complete loss.

Six other businesses in the shopping center were affected. All reopened in the following days and weeks. The martial arts studio never reopened. After 15 years of operation the business closed for good. It was not properly insured and the owner did not have enough of a capital in reserve to rebuild the business.

Repairs can take several months after a major loss. This business couldn’t survive the loss of operating income. A Business Interruption rider can cover the loss of profits and provided for expenses like rent and employee salaries. Extra Expense Coverage can even help move your business to a new location.

You don’t have to be in a disaster area to be affected

Internet based businesses can be effected by power and network outages that occur hundreds of miles away, in another state. Many data centers in New York City where submerged in several feet of sea water during hurricane Sandy. This impacted thousands of hosted clients all over the country and caused prolonged outages on their ecommerce sites.  Even though they were nowhere near the site of the physical disaster they were unable to take and process orders, buy supplies, or even answer their phones and email. Interruption Insurance can help make up for lost sales and business that are the result from a service or utility interruption even if you are not physically affected by a disaster.

Disasters happen, but your business doesn’t have to be a statistic. Berkely Brokerage specialized in Business Interruption Insurance and can help you get the protection you need to survive if your business is closed.