Most small business owners understand how important it is to have proper insurance in place to cover them in the event of a fire. If they operate a 'brick and mortar' establishment and a fire does break out, then they will want to ensure that all of their equipment, fittings, fixtures and stock can be replaced without causing too much hardship. Yet while this type of insurance is essential, it does not cover the real cost to the business associated with downtime. To be protected as much as possible, therefore, these business owners should consider interruption insurance as well. How does this work?
Out Of Action
Should the premises be affected by a significant fire, then it will certainly be out of action for some time. Much will depend on the extent of the damage which will probably come from both water and fire, but one thing is for sure, the vendor will not be able to perform business as usual.
Unknown Delays
Most owners will be unable to set up shop in another building as an alternative solution and would simply have to wait until everything could be repaired. This may depend on safety inspections, insurance payouts, contractor availability and many other factors, but in the meantime, the clock will still be ticking.
Real-World Protection
This is why it is so important to have business interruption insurance in place as well. This type of cover will help pay for other expenses that may continue to rack up and take into account loss of earnings. At the least, it can help the organisation survive until such time as it can get back on its feet and continue to trade again.
Determining the Cost
Insurers will look at the financial records of the business and determine how much the organisation would likely have earned, should the fire not have happened. They will also take into account set operating expenses and will then determine the level of cover and the associated premium.
Alternative Solution
In certain circumstances, it may be possible to get a separate type of insurance that will provide reimbursement for extra expenditure, should the business owner be able to avoid a total shutdown. In this case, their actions could reduce the amount that would have been paid under a business interruption policy.
Taking Action
Get in touch with an insurance broker and talk with them about your potential exposure. Once you have provided all the necessary financial information, they will be able to come up with a solution that can help protect you in this situation. Look for a local company like Austwide Insurance Brokers to learn more.
Share12 December 2019
If you have a new baby on the way, you need to decorate the nursery and buy nappies, but you also need to review your insurance policies. Do you have enough extra health coverage? Do you have dental coverage? Do you have life insurance in case anything happens to you? Do you want life coverage on the baby? Those questions and many more are just of few of the issues you should consider before you have a baby. Hi, my name is Marni. Our family was recently blessed with the addition of a new baby, and I had to work though those questions as well. I want to make sure no new parents are under-insured so I decided to create a blog of facts and tips. I hope these posts help you.
