Business interruption insurance, also known as business income coverage, is designed to help businesses in the event of a loss due to a catastrophe, such as a fire or other disaster. When a disaster damages your business, your business may be temporarily shut down. Because of this, your business income may suffer and you will continue to incur fixed expenses such as rent, utilities, etc. Standard property insurance policies do not cover income loss caused by temporary business closure. Business interruption insurance is typically sold as part of a more comprehensive business owner's policy or added to a property insurance policy.
Business interruption insurance may cover:
- Profits you would have earned had your business not been damaged by a covered loss based on your historical financial data;
- Operating expenses, such as rent, electricity, etc., that may still be incurred despite a temporary business closure;
- Expenses incurred from running your business from a temporary location until repairs are completed at your permanent business location;
- Extra expenses incurred that result in keeping the business location open while reducing business interruption costs.
Businesses have a duty under insurance policy language to mitigate or reduce losses. Following a loss, insureds may be unsure as to the extent to which business interruption insurance will cover losses. Despite the uncertainty, business income loss claims should be filed as quickly as possible. Professional assistance will be required to determine all of the losses, getting the claim prepared, and more importantly, getting the claim paid.
Potential Issues in Business Interruption Insurance Claims:
- Denied Claims
- Lowballed Claims
- Claims Delays
- Determining Actual Business Income Loss Sustained
- Determinung Business Extra Costs Incurred
- Determining Reasonable Business Repair Expenses
- Determining Total or Partial Periods of Business Suspension
- Determing Sales Projections and Cost of Sales Limitations
- Determing Savings in Discontinued Business Expenses
- Expediting Expenses
- Loss Mitigation
- Insurance Coverage Interpretation Disputes
- Requests for Examinations Under Oath
- Requests for Sworn Statements
- Requests for Recorded Statements
- Issues Related to Actual Cash Value
- Issues Related to Replacement Cost Value
- Recovery for Theft or Vandalism Damage
- Determining Costs of Debris Removal Issues
- Contents Claims Issues
- Law and Ordinance Issues
- Fraud or Arson Accusations
- Total Loss or Constructive Total Loss Issues
- Appraisal or Appraiser Issues
- Umpire Issues
- Supplemental Claims
- Litigation and Trial
- Bad Faith
Business interruption insurance claims can result from damages caused by events such as:
- Natural Disasters
- Water Damage
- Plumbing/Pipe Burst
We understand that as a business owner, it is your number one goal to get your business back up and running as quickly as possible.
In Case Of Business Interruption or Property Damage:
Mitigate, Document, Notify
As soon as practicable after suffering business interruption or commercial property damage, do as follows:
Use your best efforts to make temporary repairs so that the damage to your property does not get worse. This will prevent the insurance company from later claiming that your claim losses are the result of your failure to mitigate your damages. For example, if you have a roof leak due to a storm, hire a roofer to put a tarp over the leak area. Try not to pay for the repairs in cash and if you do have to pay in cash, get a receipt and the name and contact information for the repair vendor. Submit the temporary repair receipts to your insurance company for payment.
Document, Document, and Document
Taking appropriate action right after the loss will help to properly present your claim for maximum results. It is very important that all business losses are identified and documented such as to quantify and report to the insurance company all business interruption losses.
Here are some additional documentation tips: Take pictures of all affected areas. Take video, if you can, of all affected areas. Hold on to any receipts and estimates for repairs. Get the contact information for any contractors that come to your place of business to give you estimates. Do not throw out any correspondence or documents that are sent to you by your insurance company. If you are mailing anything to your insurance company do it by certified mail, return receipt requested, and make copies of whatever you are sending for your records. Keep a journal of all your communications with your insurance company. If you become aware of any witnesses that have knowledge of any aspect of your claim, record their name and contact information. Don't throw out any of the business damaged property items.
Put your insurance company on notice of your business interruption or business property damages, promptly. Call your insurance company and let them know what happened. Get the name of the insurance company adjuster assigned to your claim, his or her contact information and the claim number.
You can reach Insurance Claims Lawyer J.P. Gonzalez-Sirgo by dialing his direct number at (786) 272-5841, calling the main office at (305) 461-1095, or Toll Free at 1 (866) 71-CLAIM or email Attorney Gonzalez-Sirgo directly at[email protected].