Business Interruption Insurance to Help You with Finances When Your Doors are Closed

The majority of businesses in Australia that experience interruption due to an unexpected incident, such as a fire outbreak, significant storm damage, or a pandemic like COVID-19, fail to recover due to financial losses if they are not insured, or are not adequately insured, by business interruption insurance. A business interruption insurance policy, as the name implies, covers the loss of gross profits caused by a business interruption caused by an insured event. The coverage will pay you for the ongoing costs of running your business, as well as protect your profit margins, for a set period of time, or until you are able to resume normal operations, as specified in your business interruption insurance policy.

Utility bills, rent, employee wages, and ongoing expenses related to equipment leasing can all be covered by business insurance. However, the indemnity period of business interruption insurance should be carefully selected. Such insurance jargon may be perplexing to you, and this is where the expertise of a reputable insurance brokerage, such as Bluewell, can come in handy. The indemnity period is the length of time for which your company may require financial assistance to meet ongoing financial costs.

Indemnity period would vary on the nature of your business

A business that can easily relocate and operate, such as a software development company or customer service, may require a shorter indemnity period, whereas a tourist destination, warehouse, or factory may require a longer indemnity period. Insurance brokerages that provide business interruption insurance typically provide an indemnity period ranging from three to thirty-six months, depending on the nature of the business.

The following are typically covered by a business interruption insurance coverage:

• Financial costs, such as lease payments, mortgage payments, and hire purchases
• Utilities, such as electricity, communications and water charges
• Rent and other fixed outings
• Payroll costs and superannuation contributions
• All other expenses that will continue to occur till the period business remains interrupted

Many businesses that suffer a significant loss as a result of a sudden interruption are unable to resume operations in the absence of coverage. Some businesses may remain open for a period of time, but they may not be able to provide the same level of service as before the interruption.

Still wondering if you need business interruption insurance? Think of the below situations:

• For how long you will be able to operate your business after a disturbance or interruption?
• Would you be able to pay off wages for weeks and months without your regular cashflow?
• How would your family’s lifestyle be impacted if you are unable to draw a salary?
• Would be able to sustain the running costs of your business while your operations are closed?
• Would you be able to sustain the loss caused due to your customers moving to the competitors?

If you believe you will be unable to meet such challenges, you should consider purchasing business interruption insurance. The goal of business interruption insurance is to return your company to its normal operating level, or as close to it as possible and as soon as possible. While standard business insurance would cover the costs of repairs, business interruption insurance would compensate you for any income lost while your doors are closed.

Benefits of working with expert insurance brokerage

Bluewell insurance brokerage experts will not only assist you in obtaining the best wording for business interruption insurance, but also with any other increased costs that arise directly or indirectly as a result of business interruption. Bluewell insurance brokerage will gladly provide you with sound advice and insights for your business interruption insurance coverage in the following areas:

• Adequacy of the indemnity period
• Customer dependencies
• Pay-roll covers, and
• Increased costs to maintain revenue

Remember that the longer the indemnity period, the higher the premiums for your business interruption insurance. While considering business interruption insurance, it is also important to consider the additional costs of working, the portability of your business, and your ability to recover and run to your pre-loss level, and the experts at Bluewell insurance brokerage will assist you throughout the process.

The benefits of working with Bluewell insurance coverage are many as you will have:

• A high level of assurance that the risks are transferred as intended
• A formal process of risk identification
• A greater understanding of the potential risks specific to your business
• Linkage between the coverage and the overall process of risk management
• The widest network of insurance coverage providers

Bluewell insurance brokerage is committed to providing you with a fair, efficient, and consistent claims process. Bluewell also assists clients who have business interruption insurance or other coverage obtained through an insurance brokerage, such as public liability insurance, home and contents insurance, management liability, and so on, in lodging or notifying an insurer of their claim. For any questions or to discuss your potential business interruption claim, contact your assigned Bluewell insurance brokerage's claims contact person or a member of the Bluewell insurance brokerage team.

Bluewell insurance brokers provide contractors insurance that is specifically designed to protect your company from financial losses of any kind.