Business Interruption Insurance: How does it protect your business income?

If your business is forced to temporarily close due to a covered loss, Business Interruption insurance could help by recovering lost income and cover ongoing business expenses such as rent and employee payroll. Businesses with a physical location may find this type of coverage beneficial if they were to face unexpected interruptions.

There are several things that could hinder your business operations and cause a shutdown. For the most part, here are a few covered losses that could be considered common:

• Fire: If your workplace catches fire and causes damage that halts your business.
• Water Damage: If there's a water leakage that damages your property causing you to shut down and lose income.
• Natural Disasters: If a natural disaster occurs and damages your business, causing it to shut down.

Here are some common expenses that could be included in your coverage:

• Lost income
• Rent, lease, a mortgage
• Taxes
• Payroll or employee wages
• Relocation: If you need to relocate to a temporary facility for a covered reason. The loss of income during the transition could be covered

Here are a few examples of how  Business Interruption insurance can help an entrepreneur in times of turmoil.

1. Bruce owns a restaurant. One evening, a fire breaks out in the kitchen, causing damage to a large portion of the kitchen and his equipment. Bruce is unable to cook and must close his restaurant while repairs are completed. Business Interruption insurance could provide Bruce with the income lost while his business was closed and would also cover ongoing expenses such as rent and employee wages.
2. Wayne has a photography studio. Unfortunately for him, the studio gets broken into, his cameras are stolen, and his workplace gets damaged. Not only does he need to replace his equipment but he'll also have to relocate to a temporary studio while his place gets renovated. His Business Interruption insurance could help replace some or all of his lost income and expenses for the move and even help pay for renting out a new studio while the repairs are completed.

While everyone has their own circumstances and choices when it comes to buying insurance coverage for their business, having Business Interruption coverage could help provide coverage for unexpected situations which may otherwise seem catastrophic. Continuity is key when it comes to running a business. If for some unforeseen reason, your business does come to a halt, your Business Interruption insurance may protect your business income and relieve some of that financial stress allowing you to focus on getting back on track. When it comes to protecting your business income, it’s a good idea to hope for the best but prepare for the worst.

If you're looking for Business Interruption insurance, you can learn more about the options at TD Insurance or talk to a licenced TD Insurance advisor (1-855-724-2883) to get started with flexible plans tailored to your business needs