Insuring for Business Interruption

Business Interruption is one of the most important insurances for your business. Yet, it is frequently misunderstood.

Imagine if your revenue went to zero overnight. The many fixed costs within your business would still be payable (For example wages, rent, supplier invoices, interest payments to list a few).

Business Interruption covers your fixed costs and profits following a reduction in revenue caused by an insurable event. This provides the business with time and cash to rebuild and recover.

According to a survey of 500 businesses by leading insurer CGU, one in four would not survive if they could not operate from their location for three months, however, the majority of these businesses did not have business interruption cover.

Tempo Tips

• Traditionally, many businesses have a 12 month policy limit. But can you really rebuild your property in 12 months? With ongoing delays for both building materials and labour we recommend considering a 24 month limit.
• Even if you can work away from your location or if the property is only partly damaged, the impact to your revenue and financial bottom line can still be significant