Business hit, revenue uninterrupted..
An indefinite shutdown is a financial nightmare for business owners.
Last year, many were severely impacted when governments introduced trading restrictions to control the spread of the COVID-19 virus, leading to a messy legal fight over business interruption insurance.
The court battle is still ongoing and it may be a while yet before the matter is settled. At the heart of the dispute is whether claims from small businesses for losses caused by the pandemic are valid.
The dispute is a matter for the courts to decide. Our job is to advise you on the potential risks to your business and the range of insurance solutions available to see you through a crisis. And business interruption cover fits into that picture.
Don’t let what you’ve read or heard about the court dispute put you off business interruption insurance – it’s vital. It covers you for loss of income if you are forced to stop trading because of a disaster or many other unforeseen circumstances.
There are bills to be paid even if your business is closed indefinitely. You have your fixed expenses such as rent, wages and loan repayments to worry about when your revenue stream is disrupted.
Take the example of one client whose business interruption cover provided him with rental income payments when his property had to undergo repair for water damage.
Had he not had the cover he would have had to increase the loan value of the mortgaged property to cope with the temporary income loss. And this action – thankfully one that he did not have to take – would have meant additional financing expense for him.
Of course there will be policy exclusions that you will need to be aware of. Every policy is set out differently and if you want a specific risk covered, it can be arranged.
Business interruption insurance is essential if you want to completely cover your business against the wide range of risks that would impact your ability to survive. The team at Adroit Insurance and Risk can set you up with a business insurance program that gives you peace of mind.
This article originally appeared on Adroit Insurance & Risk Blog and has been published here with permission.
Advisr does not provide advice and does not hold a financial service license (AFSL). All information above has been provided by Adroit Insurance & Risk.