Whenever a calamity devastates an area, businesses are also directly affected by the losses. Water, smoke, flood, and wind damages may force the owner to go out of business for days. A business interruption insurance claim is highly needed in this situation.
For each day that the business is out of operation, the losses pile up while the cost of repairs skyrockets. It’s a double blow for business owners, especially if the insurance company denies the claim.
Does business interruption insurance cover payroll?
Yes and no. Most of the time, insurance companies see payroll as an unnecessary expense since the business is closed for a specific timeframe. Not unless you get Ordinary Payroll insured, you wouldn’t get reimbursed on this part.
Ordinary Payroll is defined as the salary for employees including managers, officers, supervisors, and any employee under a contract. This would be covered if you have Business Interruption Policy or a clause in your general policy that indicates the coverage.
3 Types of Business Interruption coverage
For those who are new to business interruption claims, there are three common coverage types that you can avail. These are the following:
- Business interruption insurance
This is the most common choice, especially for small businesses. This compensates the business owner with the amount of income lost during the restoration of the damages. The business interruption insurance cost is applicable only to the timeframe on which the damages are being repaired.
- Extension business interruption
If the policyholder wants added coverage, the extension business interruption can compensate the business owner for the income s/he lost after the repair is done. However, this is only effective after the business’ income go back to its pre-loss state.
- Contingent business interruption
This is a rare inclusion, but some business owners would extend their business interruption insurance with a contingency plan. It covers the damage incurred to the property of suppliers, providers, and other stakeholders indicated on the coverage.
A business owner can avail all of these coverage terms in one policy. However, it would have a higher cost.
Dos and don’ts when filing for a business interruption claim
Once you discover that your business property is damaged, make sure that you contact your business interruption consultants – public adjusters. They would help you assess the actual cost and guide you to get the right insurance payout.
Also, make sure that your business records are secure so you can present it to the insurer upon filing for a claim.
One thing you should avoid is filing the business interruption insurance claim on your own. Insurance companies will try to rip you off by offering a settlement just to skip the dragging process.
Moreover, never sign any deals or documents until you’ve discussed it with a public adjuster and an insurance claim lawyer. This is very crucial, especially if you run a large business.
Business interruption claims can be messy without the help of the experts. If your Florida business is damaged by a calamity or a man-made incident, call Gold Coast Public Adjusters to help you out.