Why Small Business Owners Need Business Interruption Insurance

Posted by Jim Pietro on Jun 28, 2011 11:29:15 AM

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In the aftermath of the early June tornadoes that left a path of destruction from Springfield to Sturbridge, our first thought was for the people whose lives were forever changed by the event.

Even as we reached out to Mid-State customers who were affected by the devastation, our thoughts turned to others who own small or mid-sized businesses. And while it's impossible to stop the forces of nature, we want to encourage every business owner to revisit business interruption insurance and the vital protection it offers against the consequences of a disaster.

Chances are that your business location is insured against damage caused by a tornado, a fire, the heavy snows that caused so many roofs to collapse last winter, or even an out-of-control vehicle crashing into your building. So if a disaster did strike, you would receive funds to repair or replace the building.

But in the meantime, what would happen if you had to close up shop while the rebuilding was going on? How would you manage if your income suddenly came to a screeching halt? Insurance experts say that a loss of revenues often hurts a business more than the damage itself. In a worst case scenario, it could force an owner out of business.

That's where business interruption insurance comes in. It compensates you for lost income if a covered disaster forces your business to shut down. It also covers expenses that continue while your business is not in operation. And if you can see a way to avoid shutting down during the restoration, extra expense insurance can reimburse you for the reasonable costs you incur to stay open.

By now, I hope you're feeling that this coverage is something you should check out. And so I invite you to talk with me or one of our Mid-State Insurance advisors. We'll review your current business policy. If business interruption insurance is not included, we'll take a look at an endorsement or add-on. We'll help you figure out what policy limits and deductibles make sense for you. And we'll also consider other variables - such as the time and costs that would be involved in relocating your specific type of business.

Like you, I hope that your business will never have to deal with a disaster. But, as recent events remind us, there are no guarantees. And so I encourage you to find out more about how business interruption insurance can protect - or even save - your business if the unthinkable should happen.

Topics: Jim's Blog, disaster planning, business interruption insurance, business insurance

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