Will a Business Interruption Policy Cover Storm Damages?
A business interruption policy can be similar to a homeowners' insurance policy in that it may cover the same types of structural damage inflicted by water, wind, mold, and mud.
However, the policy may differ in two ways:
- First, it may cover property, equipment and inventory that are unique to business claims, such as computers.
- Second, the policy may also feature coverage for periods when business drops off during a storm recovery period or when your business is adversely impacted because of problems other companies you work with are experiencing.
The difference between a property insurance and business interruption policy is that additional coverage is given with business interruption insurance. The additional coverage is compensation for profits that would have been earned had the business not been damaged or caused to close for a period of time. If your business is damaged by a storm and you possessed a business interruption policy, then you will be covered.
Business interruption also covers the expenses your business gets charged with even though the location is temporarily unusable. These costs will be determined by past expense records.
This policy will also cover the costs that accumulated in having to move your business and operate out of a different location while the damages are being repaired. Especially if your business is operating out of the Gulf Coast area, it would be wise to get business interruption insurance because property insurance will not cover all of the losses your business will incur as a result of a tropical storm or hurricane.