Business Interruption Insurance in Pennsylvania

Also providing business interruption insurance to residents in Maryland, North Carolina, New Jersey, and Virginia.

Anthony Acri Insurance

What is business interruption insurance?

A prolonged loss of revenue could be financially draining, and potentially bankrupting, for any business. Business interruption insurance may help businesses in Pennsylvania survive a prolonged drop in revenue that follows a covered disaster.

Business interruption insurance generally provides specialized protection against certain causes of lost revenue. When no income is coming in, coverage might provide alternative income.

• When does business income coverage make sense for a Pennsylvania business?

   

• Business income coverage is something that many Pennsylvania businesses should consider. Anytime a prolonged drop in revenue would cause strain, this coverage might help. It can be especially important if a business needs revenue to pay rent, utilities, salaries, or other essential expenses. 

  Because maintaining revenue is so important, this is one insurance that’s not limited to a specific industry or size of business. The following examples show how diverse businesses might need help replacing lost revenue:

  • Hotels may need to cover a land lease, utility payments, and reconstruction loan payments while a heavily damaged hotel is rebuilt.
  • Manufacturers may need to cover utility payments, employee wages, and supply costs while manufacturing resumes if inventory is destroyed in a disaster.
  • Restaurants may need to cover lease payments, utility costs, and wages even after reopening, as it can take some time for customers to realize a restaurant has reopened.
  • Seasonal resorts, such as campgrounds, water parks, and theme parks, may need to cover an entire season’s revenue if a disaster strikes early on in peak season.

Should small businesses get business income coverage?

Business income coverage can be especially important for small businesses, as small businesses typically don’t have major financial reserves in case something happens.

Because it can be so important, business income coverage is included as a core protection of most business owners policies. These are fairly standard policies for small businesses to get.

What sorts of events can business income coverage protect against?

Business income coverage generally protects against perils that can significantly damage the assets that a business owns. This is most significantly a building, but could be other assets depending on a policy’s terms. The types of perils that are covered might include fire, smoke, lightning, wind, other severe weather, vandalism, theft, and additional risks.

Exactly what protections a business income policy provides depend on that policy’s terms, so it’s important to understand them before purchasing coverage. An insurance agent who specializes in business income coverage will be able to review a particular policy’s terms, conditions, exclusions, and protections.

How long does business interruption coverage provide supplemental payments?

How long a business interruption policy’s supplemental payments last generally depends on what type of coverage is purchased. There are three main options:

• Standard Business Interruption Coverage: Usually provides payments until the business is able to reopen. This could be throughout the duration of a building’s repairs, for instance.
• Extended Business Interruption Coverage: Usually provides payments until reopening, and then still afterward for a specified duration. This could be for 30, 60, or 90 days after reopening, or for some other period.
• Contingent Business Interruption Coverage: Usually provides payments for revenue losses that stem from a disaster that impacts a supplier, rather than the insured business. Payments could last for a specified time, or until orders can be received from the same or an alternative supplier.

Are market changes covered by a business interruption policy?

One risk that business interruption policies generally don’t cover is market changes that affect a business. It falls on a business owner to make strategic decisions and adjust when market conditions change.

Where can Pennsylvania businesses get business interruption insurance?

If you have a Pennsylvania business that’s not protected against disaster-caused revenue losses, get in touch with the independent insurance agents at Acri Insurance Agency. We’ve worked with many businesses in the state, and have the expertise to help you find business interruption insurance that’s right for your business.