Business Interruption

In addition to direct loss or damage to your property, loss can occur as a consequence of the direct damage. Such indirect losses are financial in nature and result from the loss of use of the property directly damaged. Several types of coverage's have been developed to address these indirect loss exposures. The two most common forms of protection for these types of losses are Business Income Coverage Form and Extra Expense Coverage Form

Business income Coverage -

Just as a firm buys fire insurance to reimburse it for loss to its property, it may need business income coverage to reimburse it for its expenses that the firm cannot-or does not -wish to discontinue. Usually, it is written to cover losses resulting from either the same insured perils as are on the building or as are on the business personal property, which will be the Basic Form, Broad Form or Special Form.

Extra Expense Coverage -

The term "extra expense" refers to the costs a firm may incur which are in excess of the costs it normally has of doing business, and which are arise because a property loss has occurred. For example, if it will take several months for repairs to be made at the damaged location, it may appear to be desirable to rent another building and move the business there temporarily. Of course, such a move will cost additional rental expense, plus the cost of moving there (and back), and special advertising to let the customers know where the business is now located.

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