Business Income and Extra Expense insurance covers time-sensitive losses resulting from a covered direct-damage loss involving buildings and/or personal property. When business property is damaged or destroyed, it can take an extended amount of time to repair or rebuild before the firm can return to income and production levels enjoyed immediately preceding the loss. Lost income and extra expenses can be the largest costs business owners face when property is destroyed
Lost income and extra expenses can be the largest costs business owners face when property is destroyed.
The standard Business Income policy will pay for restoration expenses only if they reduce loss; and the contract might not cover additional expenses. However, a rider for extra expense coverage may pay for items such as restored telephone service, substitute space, the expense of moving, additional advertising, purchase or rental of computers or other equipment.
Long-term business plans, emergency plans and specific business processes need to be evaluated in determining the amount of Business Income and Extra Expense protection needed.