Business Interruption Insurance
What Is Business Interruption Insurance?
Whilst having your business impacted by a disaster can be a scary prospect for business owners, it’s an entirely possible one – just look at the coronavirus pandemic as a recent example. When disaster strikes, what was once a thriving business can suffer drastically. In the event of a disaster that can impact the success of your business, having the correct cover and insurance – such as our business interruption policy – can help to minimise your losses. With this policy, you’ll be covered for events and disruption that could be detrimental to your business, such as a fire.
We understand that every business in every sector will have varying needs, which is why our experts are on hand to provide a bespoke policy to ensure that you have the right level of protection. Best of all, getting a quote for these policies couldn’t be easier – simply fill out our form, request a callback and a member of our team will contact you to discuss your options.
What to expect from our business interruption insurance:
Our plans are designed to provide the cover you need, whether that’s for your people, property or your contents. We’re committed to ensuring that your business has all the protection it needs and our comprehensive cover reflects that.
At The Insurance Octopus, we understand that every business and every sector is different. With this in mind, we tailor every policy to meet your own unique set of circumstances and requirements. Throughout the application process, we’ll assess your business and the way you operate, to determine the right level of cover for you.
A Simple Process
Our insurers have an easy claims process, to make your experience as stress-free as possible. The process of changing your policy is also simple. If your needs change, you can let us know at any time and we can adjust your policy accordingly – we don’t charge any mid-term fees.
Understanding business interruption insurance
Protect your businesses gross profit or revenue in the event of disasters
If you’re a business owner, the thought of a disaster striking is sure to be your worst nightmare – in the blink of an eye, a catastrophe can take you from a thriving business at the heart of your community to a company in disarray, struggling to find ways to operate following the recent events. Unfortunately, disasters do happen, just look at the coronavirus (covid-19) pandemic, so it’s vital that you ensure that your losses are covered in the event that anything that’s detrimental to your businesses success does happen. The obvious way to do this is through insurance, specifically, a business interruption policy, which will act as a safety net should anything happen that’s going to prevent you from being able to function. There are lots of different types of policy available for businesses to use, however, if it’s disaster response that you’re looking for, there’s few that perform as well as business interruption coverage. Unlike with cover that’s designed to protect your business in the event of physical damage, but with one of our interruption policies, you’ll be covered in the case of many other instances too, such as the closure of premises, denial of access to the business premises, or in cases of other disruption.
If you’re interested in learning more about these policy types and the benefits that they can have for your business in instances of financial losses and strict restrictions, keep on reading!
What is Business Interruption Insurance & Which Industries Can Benefit?
First up, let’s take a look at what this type of insurance policy is and how it could benefit a company in your industry – there are lots of benefits when you’re the policyholder for one of these plans, so don’t worry if they don’t all seem applicable to you and your business at first glance. As an insurer, it’s our job to ensure that your business has protection against all of the things that could potentially do damage, whether that’s in terms of physical damage, disruption, or cover for losses. This type of insurance is specifically tailored to provide the support needed in the event of a disaster – things such as earthquakes, fires, or in the case of recent times, the spread of diseases such as coronavirus are all examples of instances where business interruption losses could be catastrophic for your business. What’s more is that this type of insurance is applicable in more scenarios than you might think – it doesn’t always have to be major disasters, any instance where you’re forced to stop operating due to something that is out of your control is likely to be covered.
For example, think of an ice cream parlour in a popular resort – the summer season will be by far their busiest period and most of their yearly profit will be made in those few sunny months. These months are absolutely vital to the ice cream parlour and without the ability to operate for the peak season, the parlour could find itself in a really tough situation. If, for example, the parlour was to have an unforeseen problem, such as a major pipe burst or a dangerous electrical fault, the business would have to close which the vital renovation takes place. For businesses who do not have the relevant policies in place with their insurer, this could be disastrous and the peak summer season may be completely lost. This is hugely detrimental to the business and will likely lead to a lack of clarity over employees’ jobs, as well as the future of the store itself.
Seasonal businesses simply cannot afford to lose their busiest weeks and month due to a fault. This is where business interruption policies become crucial – if you have the right interruption insurance policies in place, you’ll be able to start the claims process and recuperate some of those lost earnings that you would have been expecting to make over the months where you have unfortunately been sent into a forced closure. Business interruption claims allow you to be able to claim back your projected earnings for the period based on your incoming from previous years, which is a huge lifeline for your business that could be the difference between surviving and going out of business. There are thousands of policyholders out there who have been able to make use of this benefit to keep their business up and running in times of hardship, which goes to show the immense importance of having business interruption insurance cover with your chosen insurer. Valid claims will be credited to the business, ensuring that they have the money they need to tackle the problems that they’re faced with. Of course, the appeal will be subject to a judgement by a reviewing panel, who will have the final decision when it comes to the legitimacy of the claim.
Of course, this isn’t the only story where business interruption cover will have been a lifeline for a business – thousands of businesses across a wide variety of industries have made use of the policies, particularly during the coronavirus pandemic, as you’ll have likely seen in many news stories in the past 12 months. Covid-19 has been one of the key issues that these policies have been used to combat, with many types of businesses making claims to earn back some of the coronavirus-related business interruption losses that you’ve had to deal with.
From cafes and restaurants to fashion stores and tradesmen, every industry can make use of a business interruption clause in their insurance policy.
What This Insurance Policy Can Cover – Meeting Business Requirements
For many, the part they fear the most when disaster strikes their business is the uncertainty – companies are often left in a state of worry whilst waiting for a decision regarding their insurance claim, which can limit their productivity in the meantime. Across the country, businesses in every sector have had to work with odds that are seemingly never in their favour due to the enforced lockdowns which limit their ability to trade as they would like. This is particularly true for physical stores, where minimising contact can be very difficult. As in any case, preparation is the best medicine, so it’s important to know exactly what your policy is going to cover, so you know which situations you’re secured against and which can still cause you a headache down the line should they occur.
Here at The Insurance Octopus, we understand that no two businesses are the same and that each sector requires insurance policies that are tailored to be relevant to their requirements; this is why we strive to offer a specialised insurance approach to each of our customers. When you’re making an application with us, we’ll take a look at your company, your operations, and the work out what matters most to you – this way, we’re able to offer the best insurance policy possible to suit your needs. Whether you need to protect your contents, your people, or your property, we’ve got plans that are designed to offer you everything you could need and more. We even have a tailored process that helps with claims for coronavirus! What’s more, is that our policy wordings are clear and simple, so you’re never left wondering what your package actually entails; it’s all right there in front of you. However, should you ever require any further guidance or advice, our team of insurance experts will be on hand to help you through the process, from choosing a plan to assisting you in the claims rulings. One thing is for sure, you’ll never feel like you’ve got any contractual uncertainty here at The Insurance Octopus.
Compare Business Interruption Insurance quotes from a range of UK insurers
Business interruption specialists
We offer a bespoke service focused around designing tailored cover for your business, ensuring you get the right cover you need. Our insurance experts will discuss your business needs with you and look to compare quotes from major UK insurance providers. We can often provide you with your business insurance and documents on the same day and offer a wide range of flexible payment options to suit you.
Do I need business interruption insurance?
Some business owners often assume that other insurance covers, such as buildings and contents, will cover loss of income following a disaster at their business. However this is not the case, only business interruption cover provides protection for financial losses sustained as a result of the initial damage sustained. Our business Interruption Insurance is solely sold as an add-on cover. It can therefore be added alongside core covers such as public liability and employer’s liability cover.
Business Interruption Insurance FAQs
How is business interruption insurance calculated?
Business interruption insurance is based on your expected and projected earnings for the period of time where you have been unable to operate. In certain circumstances, it will also include additional expenses that can be factored into the overall losses that your business has faced, but in general, it will relate to the following things:
- Actual loss sustained
- Projected business income
- Restoration period
- Service interruption
Can you get business interruption insurance for COVID-19?
Yes! Coronavirus is a prime example of a scenario where business interruption insurance is an incredibly important policy to have at your disposal. Many businesses have found that they’ve been forced into incredibly restrictive closures that have essentially halted their business from being able to operate, with visitors banned from entering the premises and therefore unable to make a purchase with your company. Whilst the expectation may have been for the government to provide adequate grants during this time, it appears that the best way to keep your business protected is through a solid insurance plan. With the right evidence, you’ll be able to go through the speedy claims process in no time at all, giving you the funds you need to get your organisation back on the right track. The covid pandemic has hit many businesses hard due to the unforeseen nature and longevity of the virus, but it’s never too late to give yourself protection against future contagious diseases which may have the same impact.
Why choose us for your Business Interruption Insurance?
We proudly make buying insurance different and our cover comes with a range of benefits.
Easy claims process
Accidents can happen, so when something does go wrong you can rest easy knowing our team is on hand to make the claims process as quick and stress free as possible.
No mid term fees, ever
We don’t charge any mid-term fees at all during the life of your policy – so there are no hidden fees following any changes you might need to make.
Our Process: Choosing The Right Cover For You
We’re driven to provide our clients with the best insurance policies for their business, which we feel should be based upon great coverage against the dangers and a fantastic degree of clarity for policyholders. We look to offer superb guidance for policyholders here at The Insurance Octopus, meaning our clients always know what’s going on without all of the jargon that usually associated with insurance claims and clauses. If needed, we’ll talk you through the individual policies to give you a better understanding of your package, ensuring that you are clear on all of the policy wordings and the claims processes that go along with them. Claims by policyholders are treated with the utmost importance, meaning we get a judgement for policyholders are soon as we can – this prevents you from feeling alienated from the process or left out of the loop. Once we have the decisions in relation to your claim, we’ll relay that information to you as quickly as we can.
How business interruption insurance works
Examples of business interruption cover in action
A case of arson
An estate agent rents a space next door to a bookmaker in a busy city location. One weekend after closing, the bookmaker is set upon by an arsonist who turned out to be a disgruntled customer. The arsonist manages to cause significant damage to the bookmakers and adjacent buildings with the fire spreading to surrounding buildings including the estate agents who operate out of the property next door. The business can no longer operate from these premises while repairs are made to the building. But while the business can be set up at a different location fairly easily, they’re forced to relocate to a less prominent location, further out of town which has led to a big drop in revenue for the business. Because the estate agents have Business Interruption cover in place the business is able to claim for the loss in revenue caused due to relocating as a consequence of the fire at the neighbouring property until they are able to re-occupy their previous premises.
A £30,000 summer disaster
Following a burst water pipe that causes extensive water damage, a pub in a popular tourist destination has to close over the busy summer season for renovations. This means that their annual profits are severely affected and they lose out on a big chunk of their usual custom. Luckily, they had adequate Business Interruption Insurance in place to cover them to the tune of £50,000. This means that they can afford to stay in business and be ready to open up again later that year.
Why Choose The Insurance Octopus For Your Insurance Policy
We know that business owners want to avoid business closures, and they certainly don’t want to have to deal with any of the legal issues that often arise with insurance policies, which is why we look to take all of the stress out of the situation by doing the work ourselves. If you find yourself in a mandatory closure or partial closure, simply get in touch with a member of our team, explain the circumstances, and we’ll get the ball rolling with the claims process. The sooner you’re able to get in touch with us, the more likely you are to encounter any business income loss and a result of property damage or disruptions for businesses. Once we know what the circumstances are, we can move ahead with proceedings and look to learn more details about the challenges for businesses – this enables us to put forward the strongest claim, avoiding the tedious appeals process in many instances. Context is incredibly important for an insurance claim, so be sure to give us as much information as you can when filing the documents for your claim. You’ll also want to ensure that you inform us of the full extent to which the situation is impacting you, as this again is another vital factor.
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