Business Interruption Insurance in Massachusetts

What is Business Interruption Insurance?

Major disasters can have lingering effects that continue long after the initial event itself is over, and these lingering effects can be devastating to businesses. If a business can’t open or resume operations fully, prolonged revenue losses can lead to profit decreases, unpaid bills and potentially even closure. This is where business interruption insurance may help Massachusetts businesses.

Business interruption insurance is specialized commercial insurance that uniquely protects against covered interruptions to business operations. Instead of insuring assets against damage or businesses against lawsuits, the insurance normally covers revenue losses that are directly caused by certain covered disasters. If a disaster that has lasting effects strikes, the coverage can literally be business-saving.

Because business interruption coverage is so specialized, businesses should work closely with a knowledgeable insurance agent when purchasing the coverage. Someone who specializes in this coverage can explain coverage details in full so that businesses are able to select whichever policy best meets their needs.

What Massachusetts Businesses Need Business Income Insurance?

Business income insurance offers protection that many Massachusetts businesses could be interested in. Almost any business that would struggle to survive a sustained period of no revenue should consider the insurance. Here are just a few examples of businesses and why they might want the coverage:

Hotels and motels, because they can take months to rebuild following a disaster

Restaurants and nightclubs, because they can see decreased traffic even after rebuilding

Manufacturers, because they may have no inventory to sell after a disaster

Resorts, because they could lose out on an entire season after a disaster

What Kinds of Disasters Does Business Income Insurance Extend Coverage To?

The exact incidents that a business income insurance policy covers are determined by the terms of that policy. In general, however, coverage usually extends to perils that common property insurance policies often protect against. Both types of policies frequently protect against fire, wind and theft, for instance.

Does Business Income Insurance Insurance Cover Market Crashes?

While business income policies often cover a variety of perils, market crashes usually aren’t one of them. Market forces, added competition and bad management decisions normally don’t fall within the scope of a policy’s protections. Instead, these policies primarily protect against physical threats that are outside of a business’ control.

Business Interruption Insurance Massachusetts

How Long Does Business Interruption Coverage Make Payments For?

Should a business have a covered claim, business interruption coverage will typically make payments for a predetermined amount of time or until a milestone is reached. In broad terms, there are three different types of coverage that make payments under distinct conditions:

Standard Business Interruption Coverage commonly makes payments until a business reopens following a covered disaster

Extended Business Interruption Coverage commonly extends payments for a period (e.g. 30, 60 or 90 days) after reopening

Contingent Business Interruption Coverage commonly extends protection to disruptions that key suppliers sustain

Where Can Businesses in Massachusetts Get Business Interruption Insurance?

For help finding business interruption insurance in Massachusetts, contact us at Garrity Insurance. Our independent insurance agents can help you determine what type of business income coverage is best for you, and then they can show you multiple policy options that provide that type of coverage. With our guidance, you can have confidence in your ultimate policy selection.