What Is Hurricane Harvey Business Interruption Insurance?

Business Interruption Insurance (also known as Business Income Insurance) is typically an endorsement to your Commercial Property Insurance Policy.  Its purpose is to return your business to its pre-disaster financial state. Most standard commercial policies cover only direct loss or damage to tangible items – building and business property.  While generally Business Interruption Insurance pays for lost profits or lost sales if your business cannot operate after a disaster and often includes temporary relocation expenses.  It may even reimburse you if you need to keep employees on the payroll while you make repairs.  If your location was destroyed and you have to rent another one, your business interruption insurance may cover it.

Hurricane Harvey Filing Insurance Claim

How Much Is The Deductible For A Business Interruption Claim?

Contrary to most named storm or wind insurance policies which typically have deductibles which are calculated as a percentage of the property amount value, many business interruption policies do not carry a deductible.

What Is Covered Under Business Interruption Claims?

Under a standard business interruption policy, coverage is provided for “the actual loss of Business Income you sustain due to the necessary suspension of your operations during the period of restoration.”  The suspension of the business operations must be caused by covered, direct physical damage to property at the premises that is listed in the policy Declarations.  “Suspension” and “period of restoration” are defined in the policy.  Suspension may be either total or partial slowdown or stoppage of your business activities.  The period of restoration normally begins a few days after the damage occurs and ends when the premises should be repaired or when the business is resumed at a new permanent location.

There are generally three extra coverages that that can be purchased as an addition to your business interruption coverage :

  • Loss of Utilities Coverage is often excluded from the standard business interruption policy and protects your property against damage from a loss of any utility.
  • Contingent Business Insurance covers your financial damages if vendors or related businesses are affected by the Hurricane and unable to provide services or deliver products you rely on in your business, even though your building may be undamaged.
  • Extended Business Interruption provides coverage for the income lost after the property is repaired but before income returns to its pre-loss state. Coverage is usually limited in time.

How To Submit Your Business Interruption Claim

You have the burden of proof when you file your Hurricane Harvey business interruption claim.  It is imperative that you understand your losses and communicate them to the adjuster because he has limited knowledge, if any, of your business.  You must be prepared to provide information such as:

  • The details of the interruption of your business activities.
  • What your day to day operations entail, both pre-disaster and post-disaster.
  • The financial losses your business is incurring on a day to day, week to week or month to month basis.
  • How your business will be financially impacted by moving to a temporary location.
  • Proof of Prior Income – Profit and Loss Statement.
  • Financial Statements, General Ledger Statements, Tax Returns, Customer Orders, Market forecasts from outside sources, and Supplier Statements.
  • Document and request reimbursement for all expenses, including extra expenses, debris removal, and other additional coverages that may be available under your policy.

What If You Need Immediate Funds To Repair Your Property?

You should ask for an advance if you are in need of cash to expedite the mitigation of your damages or returning your business to its full operations.

Problems With Your Harvey Business Interruption Claim?  Call Today.

Hopefully your carrier and adjuster will promptly and fairly adjust your claim.  But if you feel you are not being treated fairly, please seek help from an experienced legal professional.  Business insurance claims is what we do.  We offer free advice and you never come out pocket for our services.  We only get paid when we are successful.  Contact us today to so we can help you with your business interruption claim.

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