Don't dismiss Business Interruption Insurance
When the Government introduced trading restrictions last year, in a bid to control the spread of COVID-19, many business owners were severely impacted as their revenue stream was disrupted with no improvements in sight.
This sparked a lengthy legal battle over Business Interruption Insurance. At the centre of this dispute was the question of whether small business owners can claim for losses caused by the pandemic.
And even though the court battle is expected to take some time to resolve, don't let what you've heard about the dispute put you off Business Interruption Insurance - as it's still vital.
Business Interruption Insurance covers you for the loss of income in the event of the unexpected. Even if forced to close indefinitely, businesses still have fixed bills like rent, wages and loan repayments to pay. With revenue disrupted, this can put more stress on any business and these costs can amplify pressures, making matters worse. Business Interruption Insurance can help to alleviate some of this stress.
In one recent instance, a client's Business Interruption cover provided him with rental income payments when his property had to undergo repair for water damage. Because of the temporary income loss, if the client didn't have the cover, he would have had to increase the loan value of the mortgaged property - which would have meant additional financing expenses for him.
Another great example is when COVID-19 led to the Wimbledon tennis championship being cancelled last year. The event organiser experienced the benefits of insurance first-hand. They had taken out an insurance policy for pandemic risk prior to this and, as a result, received a payout of almost $200 million.
It should be noted however, that each policy is different. So if you're considering taking out Business Interruption Insurance, it's important to fully understand what is covered under your policy - as there may be exclusions and specific extensions can be arranged.
How Coverforce can help
Business Interruption Insurance is essential if you want to adequately cover your business against the wide range of risks that would impact on your ability to survive.
If you haven't already, get in touch with your local Coverforce office today. Our brokers can provide your business with invaluable advice on potential risks, as well as the types of insurance solutions best suited to your business.
The information provided in this article is of a general nature only and has been prepared without taking into account your individual objectives, financial situation or needs. If you require advice that is tailored to your specific business or individual circumstances, please contact Coverforce directly.
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