Texas is famous for many things and unfortunately, one of those things is the hurricanes that disrupt people’s lives by damaging homes and buildings or even just taking out power for days at a time.
For most businesses, commercial property insurance will cover the physical damage that company buildings sustain; however, general business commercial property insurance does not pay for the financial losses that occur due to an inability to bring in revenue while buildings and equipment are repaired and/or replaced.
Considering the frequency of hurricanes in Texas and the increased possibility that a business will be affected by one, commercial property insurance agencies recommend that owners supplement their general policies with business interruption coverage.
What Is Business Interruption Coverage?
Business interruption coverage is supplemental commercial property insurance that pays benefits after a business location has been rendered unworkable due to a covered loss, meaning the company can not operate and generate income.
This policy, sold by any commercial property insurance agency that offers general business insurance policies, provides the critical coverage that can make the difference between a company being able to re-open their doors after a damaging event like a hurricane or leaving them closed for good.
How Does Business Interruption Coverage Protect A Company?
Business interruption coverage added to a general business commercial property insurance portfolio protects companies by providing the funds necessary to cover revenue lost after a covered loss has occurred.
It lets business owners pay their bills and cover financial obligations while unable able to bring in any income during this period of business interruption.
It is intended to pay benefits throughout a rebuilding or relocation period aside from the benefits paid by the standard commercial property insurance, which goes toward building repair, equipment replacement, and other physical losses.
What Does Business Interruption Coverage Pay For?
When a Texas company is affected by a hurricane or another catastrophic event that makes business operation impossible, business interruption coverage from a commercial property insurance agency provides the following benefits:
- Business Income - Funds paid to cover business expenses like loans, payroll, accounts payable, and others based on the amount of income being brought in during previous months before the loss.
- Civil Authority - Funds paid to cover business expenses as above when a location is inaccessible due to the government shutdown of a nearby yet unrelated business.
- Extra Expenses - Funds paid to cover business expenses that are above and beyond the normal monthly operating expenses due to the business closure such as the need to temporarily relocate to another location.
- Contingent Business Interruption - Funds paid to cover lost income due to property damage at another company’s facility. This includes lost income that results from a supplier or customer experiencing a catastrophic event in which inventory or supplies required for production are damaged.
Round Out Commercial Business Insurance with Business Interruption Coverage
Hurricanes are common in Texas and without broad commercial property insurance that includes business interruption coverage, small company owners are at risk.
Fortunately, adding this supplemental coverage to any business commercial property insurance plan is more affordable than many companies think.
When those hurricane winds inevitably roar in, business owners in Texas can have peace of mind that whatever happens, their business will survive to see a brighter day!
About
As important as business interruption coverage can be, owners are encouraged to talk to their business insurance agency such as Service Insurance Group about this protection and how they can obtain it.
If looking for any type of personal or business insurance, the Agents at Service Insurance Group shop for the right person or business insurance policy to fit individual needs – call them at (979) 300-7345 to get a quote!
