Connect the policy to the property
Business income planning should follow the operation through a realistic shutdown and recovery. Physical repairs may be only one part of the timeline. Permits, specialized equipment, utilities, suppliers, employee retention, customer return, and seasonal revenue can extend the financial impact.
Risks to review
- A restoration period shorter than the realistic recovery timeline
- Payroll, rent, debt service, taxes, or other continuing expenses omitted
- Critical suppliers, customers, utilities, or access points not evaluated
- Extra expense needs not coordinated with the business-continuity plan
Information to prepare
- Recent financial statements and revenue by location or department
- Continuing expenses and ordinary-payroll decisions
- Critical equipment, suppliers, utilities, and replacement lead times
- Seasonality, growth, alternate locations, and recovery assumptions
Frequently asked questions
Is business income coverage simply reimbursement for lost sales?
No. The policy definition, net income, continuing expenses, restoration period, limits, waiting period, and actual loss sustained calculation all matter.
What does extra expense address?
It may address qualifying additional costs used to avoid or reduce a covered suspension, such as temporary space or expedited equipment, subject to policy terms.
Coverage descriptions are general. Eligibility, availability, limits, deductibles, valuation, exclusions, and policy terms vary. Actual policy documents control.